The total amount of overhead cost allocated to Product X would be closest to:
A)$339,000
B)$298,000
C)$296,100
D)$372,600

Question

Quizplus · Accepted Answer

Total overhead costs = $488,100
Total allocation base for all products = 11,000 labor hours

Overhead rate per labor hour = $488,100 / 11,000 hours = $44.37/hour

Product X used 6,700 labor hours, so the overhead cost allocated to Product X is:
6,700 hours × $44.37/hour = $296,109 ≈ $296,100.

The Total Amount of Overhead Cost Allocated to Product X