Midwest Corporation has provided the following data concerning manufacturing overhead for 2020:
$\begin{array}{lrr}
\text {Estimated manufacturing overhead for the year } &\$30,000\
\text { Estimated direct labor hours for the year } &2,000\
\end{array}$

Two jobs were worked on during the year: Job A-101 and Job A-102. The number of direct labor-hours spent on Job A-101 and Job A-102 were 1,200 and 1,000, respectively. The actual manufacturing overhead was $37,000.
-
What was the amount of manufacturing overhead applied to Job A-101?
A) $16,000.
B) $18,000.
C) $24,000.
D) $44,000.

Question

Midwest Corporation has provided the following data concerning manufacturing overhead for 2020:
$\begin{array}{lrr}
  \text {Estimated manufacturing overhead for the year   } &\$30,000\
 \text { Estimated direct labor hours for the year } &2,000\
\end{array}$

Two jobs were worked on during the year: Job A-101 and Job A-102. The number of direct labor-hours spent on Job A-101 and Job A-102 were 1,200 and 1,000, respectively. The actual manufacturing overhead was $37,000.
-
What was the amount of manufacturing overhead applied to Job A-101?
A) $16,000.
B) $18,000.
C) $24,000.
D) $44,000.

Quizplus · Accepted Answer

The predetermined overhead rate is calculated as estimated manufacturing overhead divided by estimated direct labor hours: $30,000 / 2,000 hours = $15 per hour. For Job A-101, the applied overhead is 1,200 hours * $15/hour = $18,000.

Midwest Corporation Has Provided the Following Data Concerning Manufacturing Overhead