Question

During the month of May, direct labor cost totaled $9,240 and direct labor cost was 30% of prime cost. If total manufacturing costs during May were $80,100, the manufacturing overhead was:_________.

Answer 1

Answer:

$49,300

Explanation:

The computation of the manufacturing overhead is shown below:

= Total manufacturing costs - prime cost

where,

Total manufacturing costs = $80,100

And, the prime cost equal to

= Direct labor cost ÷ Given percentage

= $9,240 ÷ 30%

= $30,800

So, the manufacturing overhead would be

= Total manufacturing costs - prime cost

= $80,100 - $30,800

= $49,300