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Question(s) / Instruction(s):

A manufacturing company applies overhead based on direct labor hours. At the beginning of the year, it estimated that overhead costs would be $720,000 and direct labor hours would be 90,000. Actual overhead costs incurred were $754,400, and actual direct labor hours were 92,000. Compute the predetermined overhead rate per direct labor hour.

a)            $7.83

b)            $8.38

c)            $8.20

d)            $8.00

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