Question

The Work in Process Inventory account of a manufacturing company that uses an overhead rate based on direct labor cost has a $3,200 debit balance after all posting is completed. The cost sheet of the one job still in process shows direct material cost of $1,400 and direct labor cost of $800. Therefore, the amount of the applied overhead is:

Answer 1

Answer:

$1,000

Explanation:

The work in process inventory account of a manufacturing company uses an overhead rate

The direct labour cost has a debit balance of $3,200

Direct material cost is $1,400

Direct labor cost is $800

Therefore the amount of the applied overhead can be calculated as follows

= $1,400 + $800

= $2,200

= $3,200-$2,200

= $1,000

Hence the applied overhead is $1,000