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17 November, 09:25

In Crawford Company, the predetermined overhead rate is 80% of direct labor cost. During the month, Crawford incurs $210,000 of factory labor costs, of which $180,000 is direct labor and $30,000 is indirect labor. The actual overhead incurred was $200,000. The amount of overhead debited to Work in Process Inventory should be:

a. $200,000

b. $168,000

c. $144,000

d. $160,000.

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  1. 17 November, 09:31
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    c. $144000.

    Explanation:

    the predetermined overhead rate = 80% of direct labour costs

    The amount of overhead debited to Work in Process Inventory is:

    (80%) (180000)

    = $ 144000

    Therefore, The amount of overhead debited to Work in Process Inventory should be $144000.
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