Olympia Manufacturing uses a predetermined overhead allocation rate based on direct labor cost.At the beginning of the year,Olympia estimated total manufacturing overhead costs at $1,010,000 and total direct labor costs at $820,000.In June,Job 511 was completed.The details of Job 511 are shown below. $\begin{array} { |l | l|}
\hline \text { Direct materials cost } & \$ 24,000 \
\hline \text { Direct labor cost } & \$ 13,000 \
\hline \text { Direct labor hours } & 500 \text { hours } \
\hline \text { Units of product produced } & 500 \text { hours } \
\hline
\end{array}$ What is the amount of manufacturing overhead costs allocated to Job 511? (Round any percentages to two decimal places and your final answer to the nearest dollar.)

Question

Olympia Manufacturing uses a predetermined overhead allocation rate based on direct labor cost.At the beginning of the year,Olympia estimated total manufacturing overhead costs at $1,010,000 and total direct labor costs at $820,000.In June,Job 511 was completed.The details of Job 511 are shown below. $\begin{array} { |l | l|} 
\hline \text { Direct materials cost } & \$ 24,000 \
\hline \text { Direct labor cost } & \$ 13,000 \
\hline \text { Direct labor hours } & 500 \text { hours } \
\hline \text { Units of product produced } & 500 \text { hours } \
\hline
\end{array}$ What is the amount of manufacturing overhead costs allocated to Job 511? (Round any percentages to two decimal places and your final answer to the nearest dollar.)

Quizplus · Accepted Answer

$\begin{array}{llcc}
  \text {Estimated manufacturing overhead costs for the year  } &\$1,010,000  \
 \text {Estimated total direct labor costs  } &\$820,000\
 \text { Predetermined overhead allocation rate as a percentage of direct } &(\$ 13,000 \times 123.17 \%  \
 \text {   labor cost $ (\$ 1,010,000 / \$ 820,000) $} &123.17\%\
\
 \text { Calculation of manufacturing overhead costs allocated to Job 511: } &\
 \text {Direct labor cost  } &\underline{\$13,000}\
 \text {Manufacturing overhead costs allocated to Job 511  } &\underline{\underline{\$16,012}}\
\end{array}$

Olympia Manufacturing Uses a Predetermined Overhead Allocation Rate Based on Direct