A company estimates the following manufacturing costs for the next period: direct labor, $476,000; direct materials, $191,000; and factory overhead, $135,000. Required: 1. Compute its predetermined overhead rate as a percent of direct labor. 2. Compute its overhead cost as a percent of direct materials.

You are in the market for a new refrigerator for your company’s lounge, and you have narrowed the search down to two models. the energy efficient model sells for $700 and will save you $45 at the end of each of the next five years in electricity costs. the standard model has features similar to the energy efficient model but provides no future saving in electricity costs. it is priced at only $500. assuming your opportunity cost of funds is 6 percent, which refrigerator should you purchase