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Patterson Corporation expects to incur $70,000 of factory overhead and $60,000 of general and administrative costs next year. Direct labor costs at $5 per hour are expected to total $50,000. If factory overhead is to be applied per direct labor hour, how much overhead will be applied to a job incurring 20 hours of direct labor

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ayokenny2001

Answer:

$140

Explanation:

With regards to the above, since the factory overhead is to be applied per direct labor hour

= [$70,000 ÷ ($50,000 ÷ $5) 20 hours]

= $70,000 ÷ 10,000 × 20 hours

= $7 × 20 hours

= $140

Therefore, $120 will be applied to job incurring 20 hours of direct labor

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