Question

Iglesias, Inc. completed Job 12 on November 30. The details of Job 12 are given​ below: Direct labor cost $ 840 Direct materials cost $ 1 comma 300 Machine hours 8 hours Direct labor hours 22 hours Predetermined overhead allocation rate $ 90 per machine hour What is the total cost of Job​ 12? A. $ 1 comma 560 B. $ 2 comma 020 C. $ 2 comma 140 D. $ 2 comma 860

Answer 1

Answer:

D. $ 2 comma 860

Explanation:

The total cost for the job consist of the direct cost and the indirect  or over head cost incurred in the production process. The overhead is usually a function of direct labour or machine hours.

Given;

Direct labor cost = $ 840

Direct materials cost = $1300

Machine hours = 8 hours

Direct labor hours = 22 hours

Predetermined overhead allocation rate  = $ 90 per machine hour

Therefore,

Overhead cost = $90 × 8 = $720

Total cost = $840 + $1300 + $720

= $2860