Question

A company has an overhead application rate of 122% of direct labor costs. How much overhead would be allocated to a job if it required direct labor costing $15,000

Answer 1

Answer:

$18,300

Explanation:

Data provided in the question

Direct labor cost = $15,000

Overhead application rate = 122%

By considering the above information, the allocated overhead is

= Direct labor cost × Overhead application rate

= $15,000 × 122%

= $18,300

By multiplying the direct labor cost with the overhead application rate, the allocated overhead could come