Luthan Company uses a plantwide predetermined overhead rate

Luthan Company uses a plantwide predetermined overhead rate of $23.20 per direct labor hour. This predetermined rate was based on a cost formula that estimated $278,400 of total manufacturing overhead cost for an estimated activity level of 12.000 direct labor hours. The company incurred actual total manufacturing overhead cost of $267000 and 12.800 total direct labor-hours during the period. Required Determine the amount of manufacturing overhead cost that would have been applied to all jobs during the period. Brex2 of 13

Solution

Manufacturing overhead applied = 12800*23.20= 296960