Answered

Trenton worked on four jobs during its first year of operation: nos. 401, 402, 403, and 404. A

review of job no. 403's cost record revealed direct material charges of $40,000 and total

manufacturing costs of $50,000. If Trenton applies overhead at 150% of direct labor cost, the

overhead applied to job no. 403 must have been:


A$0.
B$6,000.
C$4,000.
D$3,333.
E$5,000.

Verified Answer :

To find the overhead applied to job no. 403, subtract direct material charges from total manufacturing costs to get direct labor cost.

Then, apply overhead at 150% of the direct labor cost to find the total overhead applied.

The overhead applied to job no. 403:

  1. Calculate the direct labor cost: $50,000 - $40,000 = $10,000.
  2. Apply overhead at 150% of direct labor cost: 150% of $10,000 = $15,000.
  3. Therefore, the overhead applied to job no. 403 is $15,000.

Related Questions