Question
A company that uses job over costing applies overheadcost to jobs on the basis of direct labor-hours. For the current year, the company's predetermined overhead
A company that uses job over costing applies overheadcost to jobs on the basis of direct labor-hours. For the current year, the company's predetermined overhead rate of $12.25 per direct labor-hour was based on a cost formula that estimated $490,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours.
During the year the company incurred the following salaries and wages:direct labor, $440,000; indirect labor, $150,000; selling and administrative salaries, $260,000.
The company also incurred variousmanufacturing overhead costs (e.g., depreciation, insurance, and utilities) of$340,000 and various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing) of$462,000.
Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year.
What wasthe total amount of actual manufacturing overhead cost incurred during the year?
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