Corporation applies manufacturing overhead on the basis of direct labor-hours. At the beginning of the most recent year, the company based its predetermined overhead rate on total estimated overhead of $244,800 and 9,800 estimated direct labor-hours. Actual manufacturing overhead for the year amounted to $245,400 and actual direct labor-hours were 6,300.
The applied manufacturing overhead for the year was closest to: (Round your intermediate calculations to 2 decimal places.)
Ans. | First, of all we need to compute the predetermined overhead rate. | ||
Predetermined overhead rate = Estimated overhead cost / Estimated Direct labor hours | |||
$244,800 / 9,800 | |||
$24.98 | per direct labor hour | ||
*Now we can calculate applied manufacturing overhead cost. | |||
Manufacturing overhead applied = Actual direct labor hours * Predetermined overhead rate | |||
6,300 * $24.98 | |||
$157,371 | |||
*Actual manufacturing overhead is used to analyze if the overhead is under applied | |||
or over applied. |
Corporation applies manufacturing overhead on the basis of direct labor-hours. At the beginning of the most...
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