Lund Products, Inc., uses a predetermined overhead rate in its production, assembly, and testing departments. One rate is used for the entire company; it is based on machine hours. The rate is determined by analyzing data from the previous year to determine the percentage change in costs. Thus this year's overhead rate will be based on the percentage change multiplied by last year's costs. Lise Jensen is about to compute the rate for this year using the following data from last years costs: Machine hours - 41,800 Overhead costs, indirect materials $57,850; indirect labor $25,440; supervision, $41,580; utilities $11,280' labor-related costs, $9,020; depreciation - factory, $10,780; depreciation - machinery, $27,240; Pproperty taxes, $2880; Insurance, $1,920; Mis. overhead, $4,840. Total Overhead = $192,830
This year the cost of indirect materials is expect to increase by 30% over the previous year... The cost of indirect labor, utilities, machinery depreciation, property taxes, and insurance is expected to increase by 20% over the previous year. All other expenses are expected to increase by 10% over the previous year. Machine hours for this year are estimated at 45,980.
Compute the projected costs and the overhead rate for this year using the information about expected cost increase (round your answer to three decimal places)