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Rapid Enterprises applies manufacturing overhead to its cost objects on the basis of 75% of direct material cost. If Job 17X had $84,000 of manufacturing overhead applied to it during May, the direct materials assigned to Job 17X was:

a. $63,000.
b. $84,000.
c. $112,000.
d. $147,00

Respuesta :

Kolawole845

Answer:

Direct material cost = $112,000

Explanation:

Pre-determined overhead absorption rate rate = Estimated overhead for the period / estimated direct material cost

Pre-determined overhead absorption rate rate (OAR= 75% of direct material cost

Applied overhead = OAR × direct material cost

Applied overhead = 75%  × direct material cost

Let direct material cost be represented by y

84,000= 75% × y

y = 84,000/75%= 112000

Direct material cost = $112,000