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Problem 1: Augsburg Manufacturing Company estimates direct labor costs and manufacturing overhead costs for the coming year to be SAR 800,000 and SAR 600,000, respectively. Augsburg allocates overhead costs based on machine hours. The estimated total labor hours and machine hours for the coming year are 20,000 hours and 12,000 hours, respectively. Actual overhead for the year was SAR 580,000, while actual labor hours were 22,000 and actual machine hours were 13,000. What is the predetermined overhead allocation rate? a. SAR 30 per labor hourb. SAR 40 per labor hourc. SAR 50 per machine hourd. SAR 25 per machine hour
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