Question

In September direct labor was 40% of conversion cost. If the manufacturing overhead for the month was $66,000 and the direct materials cost was $20,000, the direct labor cost was: A. $44,000B. $13,333C. $30,000D. $99,000

Answer 1

The correct answer is A.

Step-by-step explanation:

Giving the following information:

In September direct labor was 40% of conversion cost. The manufacturing overhead for the month was $66,000.

We know that:

conversion cost= direct labor + factory overhead

Using the rule of three:

If= 66,000= 60%

X= 100%

X= (100*66)/40= $110,000

Direct labor= 110,000*0.4= $44,000