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2 December, 12:16

Lowden Company has an overhead application rate of 160% and allocates overhead based on direct material cost. During the current period, direct labor cost is $61,000 and direct materials used cost $79,000. Determine the amount of overhead Lowden Company should record in the current period.

a) $49,375.

b) $38,125.

c) $79,000.

d) $126,400.

e) $61,000

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  1. 2 December, 12:30
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    =$126,400.00

    Explanation:

    Overhead application rate: 160 per cent on direct material cost

    Direct labor cost : $ 61,000

    Direct materiel cost: $ 79,000

    Overhead cost = 160 per cent of $ 79,000.00

    = $79,000x1.6

    =$126,400.00
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