Briggs Company Briggs Company uses a job-order costing system.At the beginning of January,the company had two jobs in process with the following costs:
Briggs pays its workers $8.50 per hour and applies overhead on a direct labor hour basis.
Refer to Briggs Company.What is the overhead application rate per direct labor hour?

Question

Briggs Company Briggs Company uses a job-order costing system.At the beginning of January,the company had two jobs in process with the following costs:
 Briggs pays its workers $8.50 per hour and applies overhead on a direct labor hour basis.
Refer to Briggs Company.What is the overhead application rate per direct labor hour?

Quizplus · Accepted Answer

To find the overhead application rate per direct labor hour, we need to divide the total overhead cost by the total direct labor hours.

Total overhead cost = $240,000 
Total direct labor hours = 56,500

Overhead application rate per direct labor hour = total overhead cost / total direct labor hours 
= $240,000 / 56,500 
= $4.25

Therefore, the overhead application rate per direct labor hour is $4.25.

Briggs Company Briggs Company Uses a Job-Order Costing System