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Here are selected data for Boston Bracing​ Company: Estimated manufacturing overhead ​ $236,800 Factory utilities ​ $30,200 Estimated labor hours ​ 35,000 Indirect labor ​ $22,400 Actual direct labor hours ​ 36,000 Sales commissions ​ $53,700 Estimated direct labor cost ​ $320,000 Factory rent ​ $47,700 Actual direct labor cost ​ $320,200 Factory property taxes ​ $28,100 Factory depreciation ​ $66,000 Indirect materials ​ $33,000 If the company allocates manufacturing overhead based on direct labor​ cost, what are the allocated manufacturing overhead​ costs?

Answer :

facundobuzzetti

Answer:

Allocated MOH= $236,948

Explanation:

Giving the following information:

Estimated manufacturing overhead ​ $236,800

Estimated direct labor cost ​ $320,000

Actual direct labor cost ​ $320,200

First, we need to calculate the predetermined overhead rate:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 236,800/320,000

Predetermined manufacturing overhead rate= $0.74 per direct labor dollar

Now, we can allocate overhead:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 0.74*320,200

Allocated MOH= $236,948

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