Question

Use the budget and actual data provided for Sharp Company to answer the questions that follow.

Sharp Company
Estimated direct labor hours12,000
Estimated direct labor dollars$90,000
Estimated factory overhead costs$179,000
Actual direct labor hours11,500
Actual direct labor dollars$92,000
Actual factory overhead costs$180,000

If factory overhead is to be applied based on direct labor dollars, the predetermined factory overhead rate is

a. 199%

b. 196%

c. $14.92

d. $15.65

Answer

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