Asked by MadiCAT Panther on Apr 29, 2024
Verified
The amount of overhead applied to Job T498 is closest to:
A) $568
B) $192
C) $760
D) $952
Overhead Applied
The allocated amount of indirect costs assigned to cost objects based on a predetermined rate.
- Review the approach used in assigning manufacturing overhead to distinct jobs.
Verified Answer
JG
Jazmín GómesApr 30, 2024
Final Answer :
C
Explanation :
To calculate the overhead applied to Job T498, we need to multiply the amount of direct labor hours by the predetermined overhead rate.
Direct labor hours for Job T498 = 20
Predetermined overhead rate = $38 per direct labor hour
Overhead applied = 20 x $38 = $760
Therefore, the closest option is C) $760.
Direct labor hours for Job T498 = 20
Predetermined overhead rate = $38 per direct labor hour
Overhead applied = 20 x $38 = $760
Therefore, the closest option is C) $760.
Explanation :
Estimated total manufacturing overhead cost = Estimated total fixed manufacturing overhead cost + (Estimated variable overhead cost per unit of the allocation base × Estimated total amount of the allocation base)= $497,000 + ($2.40 per direct labor-hour × 70,000 direct labor-hours)= $497,000 + $168,000 = $665,000
Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base = $665,000 ÷ 70,000 direct labor-hours = $9.50 per direct labor-hour
Overhead applied to a particular job = Predetermined overhead rate x Amount of the allocation base incurred by the job = $9.50 per direct labor-hour × 80 direct labor-hours = $760
Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base = $665,000 ÷ 70,000 direct labor-hours = $9.50 per direct labor-hour
Overhead applied to a particular job = Predetermined overhead rate x Amount of the allocation base incurred by the job = $9.50 per direct labor-hour × 80 direct labor-hours = $760
Learning Objectives
- Review the approach used in assigning manufacturing overhead to distinct jobs.
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