Question

MNO Corporation as a job-order costing system with a predetermined overhead tate based on direct labor hours. The company bones predetermined overed rate for the current year on the following data 50,000 $285,000 Total estimated direct labor-hours Total estimated fixed manufacturing overhead cost Estimated variable manufacturing overhead per direct labor hour 3.10 $ Recently, Job P123 was completed with the following characteristics Total actual direct labor-hours Direct materials Direct labor cost 20 $710 $500 The amount of overhead applied to Job P123 is closest to Round your intermediate calculations 10 2 decimal places)

Answer 1

Answer:

Predetermined Overhead rate          = (Estimated Fixed Manufacturing overhead / Estimated Direct labor Hours )              + Estimated Variable Manufacturing overhead per DLH         = ( $ 285,000 / 50,000 hours ) +   $ 3.80         =   $ 5.70 + $ 3. 80         =     $ 9.50 per direct labor hour

Amount of Overhead applied to Job P123                = Actual Direct labor Hours x Predetermined Overhead rate                =    20 DLH x $ 9.50                =    $ 190

Amount of Overhead applied to Job P123         =    $ 190

Option (C ) is Correct