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During the month of May, direct labor cost totaled $14,985 and direct labor cost was 45%...

During the month of May, direct labor cost totaled $14,985 and direct labor cost was 45% of prime cost. If total manufacturing costs during May were $75,000, the manufacturing overhead was:

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Answer #1

Direct Labor Cost = $14985

It is given that, Direct Labor cost = 0.45 * Prime Cost

Prime Cost = Direct Labor Cost / 0.45

Prime Cost = $14985 / 0.45 =$ 33300

Total Manufacturing cost = $75000

Total Manufacturing Cost = Prime Cost + Manufacturing Overhead Cost

$75000 = $33300 + Manufacturing Overhead Cost

Manufacturing Overhead Cost = $75000 - $33300 = $41700

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