Beans Corporation uses a job-order costing system with a single plantwide predet

Question

Beans Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on direct labor-hours. The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $162,000, variable manufacturing overhead of $2.80 per direct labor-hour, and 60,000 direct labor-hours. Recently, Job K818 was completed with the following characteristics: Number of units in the job Total direct labor-hours Direct materials Direct labor cost 10 50 $ 920 $1,400 The amount of overhead applied to Job K818 is closest to: (Round your intermediate calculations to 2 decimal places.)

Explanation / Answer

Predetermine overhead rate = (162000/60000)+2.80 = 5.50 per labour hour

Amount of overhead applied to Job K818 = 50*5.50 = 275

So answer is $275

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