During the Month of May, Direct Labor Cost Totaled $10,000

question 9

Multiple Choice

During the month of May, direct labor cost totaled $10,000 and direct labor cost was 40% of prime cost. If total manufacturing costs during May were $86,000, the manufacturing overhead was:

• A) $76,000
• B) $25,000
• C) $61,000
• D) $15,000

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Definitions:

Lump-Sum Increase

A one-time payment given to employees, typically in lieu of recurring pay raises, often based on performance.

Skill-Based Pay

A compensation strategy where employees are paid based on the number, depth, or complexity of skills and knowledge they can bring to their work, rather than their job title or position.

Job Assignment

The designation of particular work roles or activities to employees based on their skills, interests, and the needs of the organization.

Skills

Abilities acquired through practice and learning that enable an individual to perform specific tasks effectively.