Question

Botosan Factory has budgeted factory overhead for the year at $645,792, and budgeted direct labor hours for the year are 260,400. If the actual direct labor hours for the month of May are 237,000, the overhead allocated for May is _______.

Answer 1

$587,760

Step-by-step explanation:

Budgeted factory overhead for the year at $645,792 budgeted direct labor hours for the year are 260,400.

If actual direct labor hours for the month of May are 237,000 and the labour hour is used as the measure for determining the overhead cost to be allocated, then

Overhead allocated for May = (237,000/260,400) × $645,792

= $587,760