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Question - During 2007, Jackson Company estimated that its manufacturing employees would work 80,000 direct labor hours. During the year the company actually worked 75,000 direct labor hours. Actual manufacturing overhead costs amounted to $344,000. Jackson applies overhead cost on the basis of direct labor hours. The manufacturing overhead account was overapplied by $16,000 during 2003. Based on this information the predetermined overhead rate was $4.80 per labor hour. How do you work out this problem to find the predetermined overhead rate ($4.80 per hour)?
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