Ramos Corporation Bases Its Predetermined Overhead Rate on the Estimated

Ramos Corporation bases its predetermined overhead rate on the estimated labor-hours for the upcoming year. Data for the most recently completed year appear below:

$\begin{array}{ll}\text {Estimates made at the begirming of the year:}\\\text { Estimated labor-hours } & 24,000 \\\text { Estimated variable manufacturing overhead } & \$ 6.86 \text { per labor-hour } \\\text { Estimated total fixed manufacturing overhead } & \$ 394,560 \\\text { Actual labor-hours for the year } & 24,500\end{array}$

Required:
Compute the company's predetermined overhead rate for the recently completed year.

Correct Answer:

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