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If ABC budgets $340,000 in Overhead for the year and uses direct labor costs that are budgeted at $500,000 as the cost driver; then, how
If ABC budgets $340,000 in Overhead for the year and uses direct labor costs that are budgeted at $500,000 as the cost driver; then, how much overhead would they allocate to each of the following jobs, given they use a normal costing system?
340000/500000x100= .68
68% of the labor cost
|
| JOB 1 | JOB 2 |
| Direct Materials | $800 | $2,380 |
| Direct Labor | $3,000 | $12,600 |
| Overhead |
|
|
Do I add direct materials and direct labor for each and overhead is 68% of that?
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