In: Accounting
Luthan Company uses a plantwide predetermined overhead rate of $22.80 per direct labor-hour. This predetermined rate was based on a cost formula that estimated $273,600 of total manufacturing overhead cost for an estimated activity level of 12,000 direct labor-hours.
The company incurred actual total manufacturing overhead cost of $268,000 and 11,700 total direct labor-hours during the period.
Required:
Determine the amount of manufacturing overhead cost that would have been applied to all jobs during the period.
manufacturing overhead applied: ____________
Manufacturing overhead applied=predetermined overhead rate*Actual direct labor hour
=22.8*11700
which is equal to
=$266760