Question
Expected annual direct labor hours 40,000 Expected annual direct labor cost $625,000.00 Expected machine hours . 20,000 Expected material cost for the year $800,000.00 Expected
Expected annual direct labor hours 40,000
Expected annual direct labor cost $625,000.00
Expected machine hours . 20,000
Expected material cost for the year $800,000.00
Expected manufacturing overhead $1,000,000.00
a. We're asked to calculate the predetermined allocation rates using each of the four possible allocation bases provided.
b. Then determine the cost of the following job using each of the four overhead allocation rates:
Direct Materials $3000.00
Direct Labor(150 hrs @ $12/hr) $1800.00
Machine hours used 150 . 150
What I have done so far on question a.
$2,425,000.00(Total Overhead) /40,000(DL hrs)=$60.23
$2,425,000.00/20,000 (Machine hrs)=$121.25
$2,425,000.00/$800,000.00(Material cost)=$3.03
$2,425,000.00/$625,000.00(Labor cost)=$3.88
Not exactly sure if question a is correct and definitely not sure how this crosswalks to question b.
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