Kelsh Company uses a predetermined overhead rate based on machine hours to apply manufacturing overhead to jobs. The company has provided the following estimated costs for next year:

Direct materials

$$9,000$

Direct labour

$20,000$

Sales commissions

$40,000$

Salary of production supervisor

$20,000$

Indirect materials

$4,000$

Advertising expenses

$7,000$

Rent on factory equipment

$8,000$

Kelsh estimates that $6,000$ direct labour hours and $10,000$ machine hours will be worked during the year. What will be the predetermined overhead rate per hour?

Question $14$Answer

a$.$

$$3\mathrm{.}20$

b$.$

$$5\mathrm{.}33$

c$.$

$$6\mathrm{.}90$

d$.$

$$2\mathrm{.}40$