Question

If fixed costs increase, the break-even point in units will

a. increase.

b. decrease.

c. remain the same.

d. remain the same; however, contribution per unit will decrease.

23. At the beginning of the year, Wilson Company estimated the following:

Overhead

$360,000

Direct labor hours

60,000 hrs.

​

Wilson used normal costing and applies overhead on the basis of direct labor hours. For the month of September, direct labor hours equaled 9,350 and actual overhead equaled $46,750.

Calculate the overhead applied to production in September.

a.

$56,100

b.

$30,000

c.

$46,750

d.

$5 per direct labor hour

e.

None of these.

Answer 1

If fixed costs increase, the break-even point in units will increase.

Predetermined overhead rate=$360,000/60,000=$6 per direct labor hour...Applied overhead=$6´9,350=$56,100. The overhead applied to production in September was $56,100.

Hope this helps, now you know the answer and how to do it. HAVE A BLESSED AND WONDERFUL DAY! As well as a great rest of Black History Month! :-)

- Cutiepatutie ☺❀❤