Gill Manufacturing Uses a Predetermined Overhead Allocation Rate Based on Direct

question 137

Multiple Choice

Gill Manufacturing uses a predetermined overhead allocation rate based on direct labor cost.At the beginning of the year,Gill estimated total manufacturing overhead costs at $1,030,000 and total direct labor costs at $830,000.In June,Gill completed Job 511.The details of Job 511 are shown below. $$\begin{array} { | l | r | } \hline \text { Direct materials cost } & \$ 23,500 \\\hline \text { Direct labor cost } & \$ 13,000 \\\hline \text { Direct labor hours } & 300 \text { hours } \\\hline \text { Units of product produced } & 400 \text { units } \\\hline\end{array}$$ How much was the total job cost of Job 511? (Round any percentages to two decimal places and your final answer to the nearest dollar.)

• A)$36,872
• B)$52,633
• C)$65,664
• D)$36,996

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Definitions:

Privity

A relationship between parties that is sufficiently close to validate contracts or grant rights or obligations.

Indirectly Benefit

To gain advantage or profit in a secondary way from an action or event not directly involved with one's efforts.

Incidental Beneficiary

A third party who incidentally benefits from a contract but whose benefit was not the reason the contract was formed. An incidental beneficiary has no rights in a contract and cannot sue to have the contract enforced.

Intended Beneficiary

A third party for whose benefit a contract is formed; an intended beneficiary can sue the promisor if such a contract is breached.