Job 590 has an ending balance of 28900 It has been charged m

Job 590 has an ending balance of $28,900. It has been charged manufacturing overhead costs of $7,200. The rate is 75% of direct labor. What was the amount of direct materials charged to the job?

Solution

Calculate amount of direct material :

Manufacturing overhead cost = 7200

Direct labour = 7200*100/75 = 9600

Direct material = (28900-9600-7200) = 12100

so $12,100 was the amount of direct materials charged to the job.