If the budgeted factory overhead cost is $460,000,the budgeted direct labor hours is 80,000,and the actual direct labor hours is 6,700 for the month,the factory overhead rate for the month is $68.65 (if the allocation is based on direct labor hours).

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Quizplus · Accepted Answer

The factory overhead rate is calculated by dividing the budgeted factory overhead cost by the budgeted direct labor hours. Therefore, the factory overhead rate = $460,000 / 80,000 hours = $5.75 per direct labor hour.

If the Budgeted Factory Overhead Cost Is $460,000,the Budgeted Direct