Wisteria Company Is Debating the Use of Direct Labour Cost

question 101

Essay

Wisteria Company is debating the use of direct labour cost or direct labour hours as the cost allocation base for allocating manufacturing overhead. The following information is available for the most recent year:

Determine the following:
A) Predetermined manufacturing overhead rate using direct labour cost as the allocation base
B) Predetermined manufacturing overhead rate using direct labour hours as the allocation base
C) Allocated manufacturing overhead costs based on direct labour cost for the year
D) Allocated manufacturing overhead costs based on direct labour hours for the year

• A) Predetermined manufacturing overhead rate using direct labour cost as the allocation base
• B) Predetermined manufacturing overhead rate using direct labour hours as the allocation base
• C) Allocated manufacturing overhead costs based on direct labour cost for the year
• D) Allocated manufacturing overhead costs based on direct labour hours for the year

---

Definitions:

Population Mean

The average value of a population parameter, which is the sum of all values in a dataset divided by the total number of values.

Confidence Interval

A compilation of numbers, resulting from the analysis of sample statistics, seen as encompassing the value of an unfounded population attribute.

Population Proportion

The fraction or percentage of a population that possesses a particular characteristic, attribute, or criterion.

Confidence Interval

A stretch of values, sourced from sampling, that is predicted to include the value of an elusive population characteristic.