Brooke Foster is employed by Wong Laboratories,Inc. ,and is directly involved in preparing and packaging the company's leading sleep aid,RestWell.Brooke's basic wage rate is $15 per hour,and she is paid time and a half for any work in excess of 40 hours per week.Additionally,Wong Laboratories provides a fringe benefit package that costs the company $5 for each hour of employee time (regular or overtime).During a recent week,Brooke worked 49 hours but was idle for 3 hours due to materials shortages.
Required:
a.Assume that Wong Laboratories treats all fringe benefits as part of manufacturing overhead.Compute Brooke's total wages and fringe benefits for the week and indicate how much of her wages and fringe benefits for the week would be allocated to direct labor and how much would be allocated to manufacturing overhead.
b.Assume that Wong Laboratories treats the part of fringe benefits related to direct labor as a component of direct labor cost.Compute Brooke's total wages and fringe benefits for the week and indicate how much of her wages and fringe benefits would be allocated to direct labor and how much would be allocated to manufacturing overhead.
Correct Answer:
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