Franklin Glass Works uses a standard cost system in which manufacturing overhead is applied on the basis of standard direct labor-hours. Each unit requires two standard hours of direct labor for completion. The denominator activity for the year was based on budgeted production of 200,000 units. Total overhead was budgeted at $900,000 for the year, and the fixed manufacturing overhead rate was $1.50 per direct labor-hour. The actual data pertaining to the manufacturing overhead for the year are presented below:
-The fixed manufacturing overhead applied to Franklin's production for the year is:
A)$484,200
B)$575,000
C)$594,000
D)$600,000

Question

Franklin Glass Works uses a standard cost system in which manufacturing overhead is applied on the basis of standard direct labor-hours. Each unit requires two standard hours of direct labor for completion. The denominator activity for the year was based on budgeted production of 200,000 units. Total overhead was budgeted at $900,000 for the year, and the fixed manufacturing overhead rate was $1.50 per direct labor-hour. The actual data pertaining to the manufacturing overhead for the year are presented below: 
-The fixed manufacturing overhead applied to Franklin's production for the year is:
A)$484,200 
B)$575,000 
C)$594,000 
D)$600,000

Quizplus · Accepted Answer

Manufacturing overhead applied = Predetermined overhead rate F1F1F1S1F1F1F10 Standard hours allowed for the actual output = 198,000 units F1F1F1S1F1F1F10 $1.50 per hour F1F1F1S1F1F1F10 2 hours per unit = $594,000

Franklin Glass Works Uses a Standard Cost System in Which