Smith Office Equipment Company's budgeted manufacturing overhead is $ 4 comma 500 comma 000. Overhead is allocated on the basis

Question

2 years ago

6

of direct labor hours. The budgeted direct labor hours for the period are 60 comma 000. What is the manufacturing overhead rate?

1 answer:

mr_godi [17] · Answer 1 · 2022-04-19T20:26:24+03:00

Answer:

$75

Explanation:

We know,

Manufacturing overhead rate = Budgeted manufacturing overhead ÷ Budgeted direct labor hours

Given,

Budgeted manufacturing overhead = $4,500,000

Budgeted direct labor hours = 60,000

Putting the values into the manufacturing rate formula, we can get,

Manufacturing overhead rate = $4,500,000 ÷ 60,000 hours

Manufacturing overhead rate = $75 per labor hour.

When the standard amount of factory cost is allocated to the production of every unit, it is called the overhead manufacturing rate.

Smith Office Equipment​ Company's budgeted manufacturing overhead is $ 4 comma 500 comma 000. Overhead is allocated on the basis