Wheeler's Bike Company manufactures custom racing bicycles. The company uses a job order cost system to determine the cost of each bike. Estimated costs and expenses for the coming year follow: Bike parts $ 353,800 Factory machinery depreciation 59,000 Factory supervisor salaries 140,500 Factory direct labor 215,558 Factory supplies 43,900 Factory property tax 27,750 Advertising cost 26,000 Administrative salaries 52,500 Administrative-related depreciation 23,200 Total expected costs $ 942,208 Required: 1. Calculate the predetermined overhead rate per direct labor hour if the average direct labor rate is $12.11 per hour. 2. Determine the amount of applied overhead if 18,900 actual hours are worked in the upcoming year.
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