Answer:
$100,000
Explanation:
Data provided in the question:
Estimated overhead = $700,000
Estimated machine hours = 200,000
Estimated Direct labor hours = 35,000
Direct labor hours for February = 5,000
Now,
The Predetermined Overhead Rate is calculated as
= ( Estimated Overhead Cost ) ÷ ( Estimated Direct Labor hour )
or
Predetermined Overhead Rate = $700,000 ÷ 35,000
or
Predetermined Overhead Rate = 20 per direct labor hour
Therefore,
The amount of overhead applied for February
= Predetermined Overhead Rate × Direct labor hours for February
= 5,000 × $20
= $100,000
