Lohan company uses plant wise predetermined overhead rate of $23.40 per direct labour hour. This predetermined rate was based on a cost formula that estimated $257,400 of total manufacturing overhead cost for an estimated activity level of 11,000 direct labour hours. The company incurred actual total manufacturing overhead costs of $249,000 and 10,800 total direct labour hours during the period. Determine the amount of manufacturing overhead cost that would have been applied to all jobs during the period.

Lohan company uses plant wise predetermined overhead rate of $23.40 per direct labour hour. This predetermined rate was based on a cost formula that estimated $257,400 of total manufacturing overhead cost for an estimated activity level of 11,000 direct labour hours. The company incurred actual total manufacturing overhead costs of $249,000 and 10,800 total direct labour hours during the period. Determine the amount of manufacturing overhead cost that would have been applied to all jobs during the period.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 8PA: Coops Stoops estimated its annual overhead to be $85,000 and based its predetermined overhead rate...

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