Spruce Company uses a job costing system. Spruce Company's schedule of cost of goods manufactured showed the following amounts for the month ended August 31. Manufacturing overhead cost is allocated at the rate of $13 per direct labor hour.
What is the amount of allocated manufacturing overhead costs for August?

Question

Spruce Company uses a job costing system. Spruce Company's schedule of cost of goods manufactured showed the following amounts for the month ended August 31.  Manufacturing overhead cost is allocated at the rate of $13 per direct labor hour.
What is the amount of allocated manufacturing overhead costs for August?

Quizplus · Accepted Answer

To calculate the amount of allocated manufacturing overhead costs for August, we need to multiply the direct labor hours by the overhead allocation rate. 
Total direct labor hours for August = 2,375 
Allocated manufacturing overhead costs = 2,375 x $13 = $30,875. 
Therefore, the correct option is A.

Spruce Company Uses a Job Costing System