Escatel Corporation bases its predetermined overhead rate on the estimated labor hours for the upcoming year. Data for the most recently completed year appear below.
Estimates made at the beginning of the year 24,000
Estimated labor hours $6.86 per labor hour
Estimated variable manufacturing overhead $394,560
Estimated total fixed manufacturing overhead 24,500
Actual labor hours for the year
Compute the company's predetermined overhead rate for the recently completed year.