Question

Norred Corporation has provided the following information: Cost per Unit Cost per Period $ 121,500 $ 44,500 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales commissions Variable administrative expense Fixed selling and administrative expense $ 7.50 $ 3.70 $ 1.60 $ 1.50 $ 0.45 If 8,000 units are produced, the total amount of indirect manufacturing cost incurred is closest to:

Answer 1

$134,300

Step-by-step explanation:

The computation of total manufacturing overhead is shown below:-

Variable manufacturing overhead = Variable manufacturing overhead cost per unit × Units produced

= $1.60 × 8,000

= $12,800

Total Manufacturing overhead = Variable manufacturing overhead + Fixed manufacturing overhead

= $12,800 + $121,500

= $134,300

So, for computing the total manufacturing overhead we simply applied the above formula.