Question

B&T Company's production costs for May are: direct labor, $18,000; indirect labor, $5,800; direct materials, $14,200; property taxes on production facility, $860; factory heat, lights and power, $920; and insurance on plant and equipment, $120. B&T Company's factory overhead incurred for May is:

Answer 1

Answer:

The total overhead cost for May = $7,700

Explanation:

Given:

Direct labor cost = $18,000

Indirect labor cost = $5,800

Direct materials = $14,200

Property taxes on production facility = $860

Factory heat, lights and power = $920

Insurance on plant and equipment = $120

Now,

the overhead cost includes the costs that are not directly related with the production of the product i.e it includes:

Indirect labor, Property taxes on production equipment, Heat light and power,and Insurance on plant and equipment

Therefore,

The total overhead cost for May = $5,800 + $860 + $920 + $120

or

The total overhead cost for May = $7,700