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3 years ago

Compute various manufacturing overhead rates.

Business

1 answer:

n200080 [17]3 years ago

7 0

Answer:

1. $28 per direct labor hour

2. 140%

3. $35 per machine hour

Explanation:

Given that,

Total manufacturing overhead costs next year = $1,400,000

Direct labor hours used = 50,000

Direct labor cost next year = $1,000,000

Machines are expected to be run = 40,000 hours

1. Manufacturing overhead rate:

= Total manufacturing overhead cost ÷ Direct labor hours used

= $1,400,000 ÷ 50,000

= $28 per direct labor hour

2. Manufacturing overhead rate:

= (Total manufacturing overhead cost ÷ Direct labor cost) × 100

= ($1,400,000 ÷ $1,000,000) × 100

= 140%

3. Manufacturing overhead rate:

= Total manufacturing overhead cost ÷ Machine hours

= $1,400,000 ÷ 40,000

= $35 per machine hour

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3 years ago

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Answer:

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