Crawford Company's standard fixed overhead cost is $6.00 per direct labor hour based on budgeted fixed costs of $600,000.The standard allows 1 direct labor hours per unit.During 2011, Crawford produced 110,000 units of product, incurred $630,000 of fixed overhead costs, and recorded 212,000 actual hours of direct labor.
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What is the activity level on which Crawford based its fixed overhead rate?
A) 110,000 direct labor hours
B) 105,000 direct labor hours
C) 100,000 direct labor hours
D) 50,000 direct labor hours

Question

Crawford Company's standard fixed overhead cost is $6.00 per direct labor hour based on budgeted fixed costs of $600,000.The standard allows 1 direct labor hours per unit.During 2011, Crawford produced 110,000 units of product, incurred $630,000 of fixed overhead costs, and recorded 212,000 actual hours of direct labor.  
-
What is the activity level on which Crawford based its fixed overhead rate?
A) 110,000 direct labor hours
B) 105,000 direct labor hours
C) 100,000 direct labor hours
D) 50,000 direct labor hours

Quizplus · Accepted Answer

SUPPORTING CALCULATIONS:
$600,000 / $6.00 = 100,000 DLH

Crawford Company's Standard Fixed Overhead Cost Is $6