Millenium Manufacturing Is Considering Two Methods for Applying Overhead $\quad \$ 871,875$

question 76

Short Answer

Millenium Manufacturing is considering two methods for applying overhead. Estimated data for the next year, 2013, follows. Estimated direct labor costs $\quad \$ 871,875$
Estimated direct labor hours $\quad 90,000$
Estimated overhead costs $\quad \$ 558,000$ 1. What would be the overhead application rate based on direct labor costs?
2. What would be the overhead application rate based on direct labor hours?
3. If a job requires 650 hours of direct labor, what would be the amount of overhead applied to the job using the rate based on direct labor hours?

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Definitions:

Fraternal

Pertaining to brothers; often used to describe twins who are born from two separate eggs fertilized by two different sperm cells, and thus are not genetically identical.

Intrinsic

Relating to the essential nature of something or coming from within, not influenced by external factors.

Middle-aged Workers

Employees typically between the ages of 40 and 65, often considered in their most productive years.

Younger Workers

Individuals in the workforce who are relatively young, often bringing fresh perspectives but facing unique challenges.