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31 August, 11:00

Deltan corp. allocates overhead to production on the basis of direct labor costs. deltan's total estimated overhead is $450,000 and estimated direct labor is $180,000. determine the amount of overhead to be allocated to finished goods inventory if there is $20,000 of total direct labor cost in the jobs in the finished goods inventory.

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  1. 31 August, 12:16
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    Hi there

    First find Predetermined oH rate

    Predetermined oH rate is

    total estimated overhead divided by

    estimated direct labor

    Predetermined oH rate=

    450,000:180,000

    =2.5

    the amount of overhead to be allocated to finished goods inventory if there is $20,000 of total direct labor cost in the jobs in the finished goods inventory is

    2.5*20,000

    =50,000 ... answer

    Good luck!
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