Aztec Industries produces bread which goes through two operations, mixing and baking, before it is ready to be packaged. Next year's expected costs and activities are shown below.

-Compute Aztec's departmental overhead rate for the mixing department based on direct labor hours.
A)$1.50 per DLH.
B)$5.00 per DLH.
C)$0.75 per DLH.
D)$0.50 per DLH.
E)$2.08 per DLH.

Question

Aztec Industries produces bread which goes through two operations, mixing and baking, before it is ready to be packaged. Next year's expected costs and activities are shown below.

-Compute Aztec's departmental overhead rate for the mixing department based on direct labor hours.
A)$1.50 per DLH. 
B)$5.00 per DLH. 
C)$0.75 per DLH. 
D)$0.50 per DLH. 
E)$2.08 per DLH.

Quizplus · Accepted Answer

Aztec's departmental overhead rate for the mixing department based on direct labor hours is $1.50 per DLH. This is because the total departmental overhead costs are $15,000 and the total direct labor hours are 10,000. Therefore, the departmental overhead rate is $15,000 / 10,000 = $1.50 per DLH.

Aztec Industries Produces Bread Which Goes Through Two Operations, Mixing