If the budget estimates that a desk lamp will require 1 hours of finishing and 2 hours of production,how much factory overhead will the Kaumajet Factory allocate to each unit of desk lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours?
A) $11.10
B) $4.91
C) $5.00
D) $7.20

Question

Quizplus · Accepted Answer

The factory overhead rate is calculated by dividing the total factory overhead by the total direct labor hours. If the overhead rate is $3.70 per direct labor hour, then for 3 hours (1 hour finishing + 2 hours production), the overhead allocated is 3 hours x $3.70 = $11.10.

If the Budget Estimates That a Desk Lamp Will Require