In December 2012, Shire Computer’s management establishes the year 2013 predetermined overhead rate based on direct labor cost.

In December 2012, Shire Computer’s management establishes the year 2013 predetermined overhead rate based on direct labor cost. The information used in setting this rate includes estimates that the company will incur $826,800 of overhead costs and $520,000 of direct labor cost in year 2013. During March 2013, Shire began and completed Job No. 13-56.

1.

What is the predetermined overhead rate for year 2013? 2. Use the information on the following job cost sheet. (Round your answer to the nearest dollar amount.) JOB COST SHEET   Customer’s Name   Keiser Co. Job No. 13-56           Job Description   5 plasma monitors—61 inch           Direct Materials   Direct Labor   Overhead Costs Applied             Date Requisition No. Amount   Time-Ticket No. Amount   Rate Amount     Mar. 8 4-129 $ 4,000     T-306 $ 620             Mar. 11 4-142   6,900     T-432   1,290             Mar. 18 4-167   3,500     T-456   1,280                           Totals                                       Determine the total cost of the job. Total cost of the job $22,662

Explanation:

2.

Direct materials	$	14,400
Direct labor		3,190
Overhead ($3,190 × 159%)		5,072
Total cost of Job No. 13-56	$	22,662