Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Oh-To-Tec uses normal costing. Factory overhead is applied to production at a predetermined rate of 200% of direct-labour cost. Any over or under-applied factory
Oh-To-Tec uses normal costing. Factory overhead is applied to production at a predetermined rate of 200% of direct-labour cost. Any over or under-applied factory overhead is closed to the cost of goods sold account at the end of each month. Additional information is available as follows for October: A transmission change job was started and completed during October. This was the only job during the month Direct materials used: transmission replacement and oil totaled $1,000 Total direct labour paid for the job is $800 Total actual factory overhead was $1,800 for the month Oh-To-Tec usually sells the job at 150% markup Calculate the gross profit that would show in the financial statements for October.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started