Nile Corp.has identified three cost pools to allocate overhead costs.The following estimates are provided for the coming year:

The accounting records show the Mossman Job consumed the following resources:

Using the three cost pools to allocate overhead costs,what is the total amount of overhead costs to be allocated to the Mossman Job?
A)$442.00
B)$449.00
C)$10,071.67
D)$428.60

Question

Nile Corp.has identified three cost pools to allocate overhead costs.The following estimates are provided for the coming year:

The accounting records show the Mossman Job consumed the following resources:

Using the three cost pools to allocate overhead costs,what is the total amount of overhead costs to be allocated to the Mossman Job?
A)$442.00 
B)$449.00 
C)$10,071.67 
D)$428.60

Quizplus · Accepted Answer

Supervision cost driver rate = 304,000 ÷ 760,000 dlh = $0.40 per dlh
Machine maintenance cost driver rate = $153,600 ÷ 960,000 mh = $0.16 per mh
Facility rent cost driver rate = $165,000 ÷ 110,000 sq ft = $1.50 per sq ft
Total amount of overhead costs to be allocated to the Mossman Job
= (260 × $0.40 per dlh)+ (1,500 × $0.16 per mh)+ (70 × $1.50 per sq ft)= $449.00

Nile CorpHas Identified Three Cost Pools to Allocate Overhead Costs