At the beginning of the year, a company estimated that 20,000 direct labor-hours would be required...

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At the beginning of the year, a company estimated that 20,000 direct labor-hours would be required for the periods estimated

business accounting

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Answer 1

Answer #1

Total variable overhead estimated=(20,000*1.5)=$30,000

Total overhead estimated=Total variable overhead estimated+Total fixed overhead estimated

=30,000+140,000=$170,000

Predetermined overhead rate=Total overhead estimated/Estimated direct labor hours

=170,000/20,000=$8.5 per labor hour

Hence overhead applied=Predetermined overhead rate*Actual direct labor hours

=(8.5*30)

=$255

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Answer 2

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