Using the single plantwide factory overhead rate with an allocation base of direct labor hours,how much factory overhead will Challenger Factory allocate to regular widget production if budgeted production for the period is 75,000 units and actual production for the period is 72,000 units?
A) $168,750
B) $324,000
C) $162,000
D) $337,500

Question

Quizplus · Accepted Answer

The correct answer is based on the calculation of factory overhead allocated using the single plantwide factory overhead rate method, which typically involves dividing the total estimated factory overhead by the total estimated amount of the allocation base (in this case, direct labor hours) to find the overhead rate per labor hour. Then, this rate is applied to the actual amount of the allocation base used during the period to find the total overhead allocated. Without the specific overhead rate or the direct labor hours estimated and actual, we cannot perform the calculation here. However, the correct choice is identified as B, suggesting that with the given information in the question or additional information provided elsewhere, the calculation would result in $324,000 being the amount of factory overhead allocated to regular widget production.

Using the Single Plantwide Factory Overhead Rate with an Allocation