Enter the total manufacturing overhead cost and the estimated units of the allocation base for the period to determine the overhead rate.
- Manufacturing Overhead Calculator
- Cost of Goods Manufactured Calculator (COGM)
- DPMO Calculator (Defects Per Million Opportunities)
Predetermined Overhead Rate Formula
The following equation is used to calculate the predetermined overhead rate.
POR = MOC / UA
- Where POR is the predetermined overhead rate
- MOC is the manufacturing overhead cost
- UA is the units of allocation.
Predetermined Overhead Rate Definition
A predetermine overhead rate is defined as the ratio of manufacturing overhead costs to the total units of allocation.
Predetermined Overhead Rate Example
How to calculate predetermined overhead rate?
- First, determine the manufacturing overhead cost.
Calculate the total manufacturing overhead cost.
- Next, determine the units of allocation.
Calculate the total units of allocation.
- Finally, calculate the POR.
Calculate the predetermined overhead rate using the equation above.