Management estimates that it costs $400 to analyze and close a commercial loan.What is the overhead rate if Muskego allocates the remaining indirect costs using direct labor hours?
A)$14.00 per hour.
B)$16.67 per hour.
C)$1,000 per loan.
D)$500 per loan.

Question

Quizplus · Accepted Answer

Overhead rate = Indirect costs / Direct labor hours= (400 + 1,000) / 70= $14.00 per hour

Management Estimates That It Costs $400 to Analyze and Close