To calculate the overhead rate, the labor overhead expense is divided by the labor overhead base ($180,000 / $120,000 = 150 percent labor overhead rate). This is the rate applied to each dollar of ...

Overhead Rate In order to calculate the amount of overhead applied, a company must first ascertain the predetermined overhead rate.

The overhead ratio measures how much of a company's total revenue is spent on indirect costs. This metric is useful for identifying areas where costs can be reduced to improve profitability ...