Factory Overhead Costs for a Given Period Were 2 Times

question 42

Multiple Choice

Factory overhead costs for a given period were 2 times as much as the direct material costs.Prime costs totaled $8,000.Conversion costs totaled $11,350.What are the direct labor costs for the period?

• A)$4,650.
• B)$3,560.
• C)$4,200.
• D)$3,860.
• $11,350 = Direct Labor Costs + Factory Overhead Costs
• Direct Labor Costs = $8,000 - Direct Materials Costs
• Factory Overhead Costs = 2(Direct Materials Costs)
• Solve for Direct Materials Costs via substitution:
• $11,350 = ($8,000 - Direct Materials Costs)+ 2(Direct Materials Costs)
• Direct Materials Costs = $3,350
• Direct Labor Costs = $8,000 - $3,350 = $4,650

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Definitions:

Economic Hierarchy

Details the structured ranking of individuals, organizations, or countries based on their economic power, wealth, or resources, influencing their status and opportunities within a society.

Political Hierarchy

A system of organization in politics where individuals or groups are ranked according to power or authority.

Modernization Theory

A theory suggesting that societal development occurs through a series of progressive stages, typically moving from traditional to modern industrial societies.

Traditional Society

A society that is largely based on customs, traditions, and pre-modern economic activities such as agriculture.