The total prime cost of a product was $4,500. The variable manufacturing overhead is calculated based on the number of direct labor hours. The variable manufacturing overhead cost per hour is twice the direct labor cost per hour. The fixed manufacturing overhead was $1,000. Assuming that direct labor hours were 250 and that the direct labor cost was 20% of direct materials cost, how much is the total manufacturing cost?

The total prime cost of a product was $4,500. The variable manufacturing overhead is calculated based on the number of direct labor hours. The variable manufacturing overhead cost per hour is twice the direct labor cost per hour. The fixed manufacturing overhead was $1,000. Assuming that direct labor hours were 250 and that the direct labor cost was 20% of direct materials cost, how much is the total manufacturing cost?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 1EA: Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor...

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