Question

Before the year began, Murphy Manufacturing estimated that manufacturing overhead for the year would be $176,000 and that 13, 700 direct labor hours would be worked. Actual results for the year included the following: Actual manufacturing overhead cost $184, 100 Actual direct labor hours 15, 100 The amount of manufacturing overhead allocated for the year based on direct labor hours would have been _____. (Round intermediary calculations to the nearest cent.) A. $194, 035. B. $184, 100. C. $176,000. D. $167, 031.

Answer 1

A. $194, 035

Step-by-step explanation:

Predetermined Manufacturing overhead Rate = Estimated total overheads / Estimated direct labor hours

Predetermined Manufacturing overhead Rate = $176,000 / 13,700

Predetermined Manufacturing overhead Rate = $12.85 / direct labor hour

Actual Labor hours = 15,100 hours

Manufacturing overhead allocated = $12.85x 15,100

Manufacturing overhead allocated = $194,035

The correct option is A. $194, 035