Question

Henson Company applies overhead on the basis of 120% of direct labor cost. Job No.190 is charged with $60,000 of direct materials costs and $90,000 of manufacturing overhead. The total manufacturing costs for Job No.190 is

Answer 1

$225,000

Step-by-step explanation:

Henson company applies an overhead which is based on 120% of direct Labor cost

= 120/100

= 1.2

Job. No 190 is charged with direct cost materials of $60,000 and manufacturing overhead of $90,000

Therefore, the total manufacturing costs for job No. 190 can be calculated as follows

Manufacturing overhead/direct labour costs+direct cost of materials+manufacturing overhead

= $90,000/1.2+$60,0000+$90,000

= $75,000+$60,000+$90,000

= $225,000

Hence the total manufacturing costs for job No. 190 is $225,000