Oches Company has analyzed its overhead costs and derived a general formula for their behavior: $50,000 + $18 per direct labor hour employed. The company expects to use 40,000 direct labor hours during the next accounting period.
What overhead rate per direct labor hour should be applied to jobs worked during the period?

Question

Oches Company has analyzed its overhead costs and derived a general formula for their behavior: $50,000 + $18 per direct labor hour employed. The company expects to use 40,000 direct labor hours during the next accounting period. 
What overhead rate per direct labor hour should be applied to jobs worked during the period?

Quizplus · Accepted Answer

The Answer of Oches Company has analyzed its overhead costs and derived a general formula for their behavior: $50,000 + $18 per direct labor hour employed. The company expects to use 40,000 direct labor hours during the next accounting period. 
What overhead rate per direct labor hour should be applied to jobs worked during the period?

Oches Company Has Analyzed Its Overhead Costs and Derived a General