Ask Question
27 August, 08:45

Chelsea, Inc. uses the job costing method and uses direct labor hours as the allocation base. In 2016, the total estimated and actual overhead costs for Job 3489 were $250,000 and $275,000, respectively. The total estimated and actual direct labor hours for Job 3489 were 25,000 and 28,000, respectively. Which of the following represents the MOH allocated to Job 3489?1. Predetermined MOH rate = total estimated manufacturing overhead costs / total estimated amount of the allocation base2. $250,000 / 25,000 DLH = $103. MOH allocated to job = predetermined MOH rate * actual amount of allocation base used by the job4. $10 * 28,000 DLH = $280,000

+1
Answers (1)
  1. 27 August, 10:38
    0
    3. MOH allocated to job = predetermined MOH rate * actual amount of allocation base used by the job

    Explanation:

    3. MOH allocated to job = predetermined MOH rate * actual amount of allocation base used by the job

    The predetermined overhead rate is used to apply manufacturing overhead costs to production jobs. the quantity of a cost driver required by a particular job is multiplied by a predetermined overhead rate to determine the amount of overhead cost applied to the job.

    An estimate is made of

    the amount of manufacturing over head that will be incurred during a specific period of time and the amount of the cost driver (or activity base) that will be used or incurred during the same time period. the predetermined overhead rate is computed as follows

    Predetermined Overhead Rate = Budgeted Manufacturing Overhead Cost / Budgeted amount of cost driver

    The predetermined overhead rate is used to apply manufacturing overhead costs to production jobs. The quantity of the cost driver (or activity base) required by a particular job is multiplied by the predetermined overhead rate to determine the amount of overhead cost applied to the job.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Chelsea, Inc. uses the job costing method and uses direct labor hours as the allocation base. In 2016, the total estimated and actual ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers