Miller Company Miller Company uses a job-order costing system. Assume that Job #504 is the only one in process. The following information is available:
Refer to Miller Company. What is the overhead application rate if Miller uses a predetermined overhead application rate based on direct labor hours (rounded to the nearest whole dollar)?

Question

Miller Company Miller Company uses a job-order costing system. Assume that Job #504 is the only one in process. The following information is available:
 Refer to Miller Company. What is the overhead application rate if Miller uses a predetermined overhead application rate based on direct labor hours (rounded to the nearest whole dollar)?

Quizplus · Accepted Answer

Overhead application rate = Estimated total manufacturing overhead cost / Estimated total direct labor hours 
= $775,000 / 144,000 DLHs 
= $5.3819 per DLH 
(rounded to the nearest whole dollar = $5.00)

Miller Company Miller Company Uses a Job-Order Costing System