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Monash Limited makes various types of metal shelving. Its budget for the current year are:
Expected productions 10,000 shelves
Expected direct labour hour 10,000 hours
Expected manufacturing overhead $1,000,000
Monash limited used an absorption/ traditional costing system and its total overhead cost is allocated based on the direct labour hours. At the end of the financial year, the following information was collected:
Direct labour hour 8000 hours
Manufacturing overhead $ 900,000
Question 1: What was actual overhead rate of the year per direct labour hours?
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