Question

Reynolds Manufacturers Inc. has estimated total factory overhead costs of $134,200 and expected direct labor hours of 12,200 for the current fiscal year. If Job 117 incurs 1,030 direct labor hours, Work in Process will be debited and Factory Overhead will be credited for a.$1,030 b.$134,200 c.$11,330 d.$67,100

Answer 1

c. 11,330

Step-by-step explanation:

With regards to the above, we need to compute first, predetermined overhead rate allocation

= Estimated aggregate overhead / Estimated number of labor hours

= $134,200 / 12,200

= $11 per hour

The overhead cost to be allocated to job no 117 will be;

= Number of direct labor hours × predetermined rate of overhead

= 1,030 × $11

= $11,330