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4 September, 03:02

Abburi company's manufacturing overhead is 60% of its total conversion costs. If direct labor is $40,000 and if direct materials are $26,600, the manufacturing overhead is:

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  1. 4 September, 06:15
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    Calculation of Abburi Company's manufacturing overhead:

    It is given that company's manufacturing overhead is 60% of its total conversion costs. And Conversion cost is a sum of Direct Material and Direct Labor costs. Hence we can say that:

    Manufacturing overhead = (Direct Material + Direct Labor Costs) * 60%

    = (26600+40000) * +60%

    = 39960

    Hence, Abburi Company's manufacturing overhead is $39,960
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