A company allocates $7.50 overhead to products based on the number of direct labor hours worked. The company uses a plantwide overhead rate with direct labor hours as the allocation base. Given the amounts below, how many direct labor hours does the company expect in department 2?
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A) 9,914 DLH
B) 6,612 DLH
C) 3,109 DLH
D) 7,454 DLH
E) 16,254 DLH

Question

A company allocates $7.50 overhead to products based on the number of direct labor hours worked. The company uses a plantwide overhead rate with direct labor hours as the allocation base. Given the amounts below, how many direct labor hours does the company expect in department 2?
'
 
A) 9,914 DLH 
B) 6,612 DLH 
C) 3,109 DLH 
D) 7,454 DLH 
E) 16,254 DLH

Quizplus · Accepted Answer

Total estimated direct labor hours:
$7.50 = ($74,358 + $49,572)/Total estimated direct labor hours
$123,930/$7.50 = 16,524 DLH
Dept. 2 DLH:
16,524 total DLH − 6,610 Dept. 1 DLH = 9,914 DLH Dept. 2

A Company Allocates $7