Predetermined shop overhead rate per direct hour

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Amoruso engine shop uses a job order cost system to determine the cost of performing engine repair work. Estimated costs and expenses for the coming period are as follows:

Engine parts                                                       980,000

Shop direct labor                                              750,000

Shop and repair equip depreciation         53,500

Shop supervisor salaries                                               140,000

Shop property taxes                                       26,300

Shop supplies                                                    20,200

Advertising expense                                      19,900

Administrative office salaries                      84,000

Administrative office depreciation expense 11,200

                Total costs and expenses             2,085,100

The average shop direct labor rate is $25 per hour.

Determine the predetermined shop overhead rate per direct hour.

Reference no: EM13790607

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