Benjamin Products uses job order costing and assigns overhead to specific jobs using direct labor hours. During the month of June, a total of 1,800 direct labor hours at a cost of $16 per hour were incurred for all jobs. Actual overhead costs for the month totaled $9,000. If a specific job required 36 direct labor hours of work, how much overhead should be applied to that job?
A) $179.20
B) $212.80
C) $180.00
D) $348.00

Question

Quizplus · Accepted Answer

The overhead rate per direct labor hour is calculated by dividing the total overhead costs by the total direct labor hours for the month. This gives $9,000 / 1,800 hours = $5 per direct labor hour. For a job requiring 36 direct labor hours, the overhead applied would be 36 hours * $5/hour = $180.00.

Benjamin Products Uses Job Order Costing and Assigns Overhead to Specific