Question

Westan Corporation uses a predetermined overhead rate of $23.10 per direct labor-hour. This predetermined rate was based on a cost formula that estimated $277,200 of total manufacturing overhead for an estimated activity level of 12,000 direct labor-hours. The company incurred actual total manufacturing overhead costs of $266,000 and 12,600 total direct labor-hours during the period. Required: Determine the amount of manufacturing overhead that would have been applied to all jobs during the period.

Answer 1

the applied manufacturing overhead is $291,060

Step-by-step explanation:

The computation of the applied manufacturing overhead is shown below:

= Predetermined overhead rate × total direct labor hours

= $23.10 × 12,600

= $291,060

Hence, the applied manufacturing overhead is $291,060