Jeremy Corporation estimated manufacturing overhead costs for the year to be $490,000.Jeremy also estimated 7,000 machine hours and 1,000 direct labor hours for the year.It bases the predetermined overhead allocation rate on machine hours.On January 31,Job 25 was completed.It required 4 machine hours and 6 direct labor hours.What is the amount of manufacturing overhead allocated to the completed job? (Round your answer to the nearest dollar.)

Question

Quizplus · Accepted Answer

C) Predetermined overhead allocation rate = Total estimated overhead costs / Total estimated quantity of the overhead allocation base
Predetermined overhead allocation rate = $490,000 / 7,000 machine hours = $70 per machine hour
Allocated manufacturing overhead cost = Predetermined overhead allocation rate × Actual quantity of the allocation base used by each job
Allocated manufacturing overhead cost = $70 × 4 machine hours = $280

Jeremy Corporation Estimated Manufacturing Overhead Costs for the Year to Be