Answer:
Instructions are listed below.
Explanation:
Giving the following information:
Estimated overhead costs:
Factory machinery depreciation 59,000
Factory supervisor salaries 140,500
Factory supplies 43,900
Factory property tax 27,750
Total overhead= 271,150
1)
First, we need to determine the estimated direct labor hours for the period:
Factory direct labor= 215,558
Direct labor rate= $12.11
Direct labor hours= 215,558/ 12.11= 17,800 hours
Now, we can calculate the estimated overhead rate:
To calculate the estimated manufacturing overhead rate we need to use the following formula:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= 271,150/17,800= $15.23 per direct labor hour
2) To apply overhead, we need to use the following formula:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 15.23*18,900= $287,847
