If expected factory overhead costs are $600 000 and expected direct labour hours are 40 000, what is the overhead application rate per direct labour hour?

Question

Quizplus · Accepted Answer

The overhead application rate per direct labour hour is calculated by dividing the expected factory overhead costs by the expected direct labour hours. Therefore, $600,000 / 40,000 hours = $15 per direct labour hour.

If Expected Factory Overhead Costs Are $600 000 and Expected