Kamper Company sells two products Big Z and Little Z Current

Kamper Company sells two products Big Z and Little Z. Current direct materlal and directfabor costs are detalled below. Next year, the company wishes to use a plantwide overhead rate with direct labor hours as its allocation base. Next year\'s overhead is estimated to be $480,000. The direct labor and direct materials costs are estimated to be consistent with the current year. Direct labor costs $20 per hour and the company expects to manufacture 37000 units of Big Z and 14,000 units of Little Z next year Direct Material per Direct Labor Dollars per Unit $17 $13 Unit $11 $17 Big z Little What are total estimated direct labor hours for this next year? O 40550 total DLH. O 811,000 total DLH. O 329412 total DLH O 1530000 total DLH O 1140.412 total DLH.

Solution

Solution:

Hence first option is correct.

Computation of estimated direct labor hours
Particulars	Big Z	Little Z	Total
Direct labor dollar per unit	$17.00	$13.00
Direct labor cost per hour	20	20
Direct labor hour per unit	0.85	0.65
Nos of expected units	37000	14000
Estimated number of direct labor hours	31450	9100	40550