For instance, if the manufacturer estimates $10,000 in overhead costs with 20,000 machine hours, the predetermined overhead rate is 50 cents per unit.

How to Calculate Overhead Cost Per Unit. Overhead cost is an indirect cost, providing common benefit to the production of different lines of products or rendering of a range of services. Unlike ...

Overhead rate is a measure of a company's indirect costs relative to another input or metric. Learn how to calculate your overhead rate.