Showboat Corporation had actual manufacturing overhead costs for the most recent year of $ 29 comma 500$29,500. Manufacturing overhead is allocated using a predetermined manufacturing overhead rate of $ 2.50$2.50 per direct labor hour. Direct labor cost is $ 27$27 per hour. At the end of the year, Cabaret Corporation found it had overallocated manufacturing overhead by $ 1 comma 850$1,850. How many direct labor hours were worked in total during the year? (Round your final answer to the nearest hour.)

Question

Kareem Brennan

Business

21 May, 14:24

Showboat Corporation had actual manufacturing overhead costs for the most recent year of $ 29 comma 500$29,500. Manufacturing overhead is allocated using a predetermined manufacturing overhead rate of $ 2.50$2.50 per direct labor hour. Direct labor cost is $ 27$27 per hour. At the end of the year, Cabaret Corporation found it had overallocated manufacturing overhead by $ 1 comma 850$1,850. How many direct labor hours were worked in total during the year? (Round your final answer to the nearest hour.)

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Answers (1)

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Jameson · Answer 1

The direct labor hours that worked in total during the year is 12,540 hours

Explanation:

The computation of the direct labor hours worked is shown below:

= Total labor cost : cost per hour

where,

Total labor cost = Manufacturing cost + over allocated manufacturing overhead

= $29,500 + $1,850

= $31,350

And, the rate per hour is $2.50

Now put these values to the above formula

So, the direct labor hours would equal to

= $31,350 : $2.50

= $12,540 hours