During March 2019, NY Bay Corporation recorded $275,000 of costs related to factory overhead. Alpha’s overhead application rate is based on direct labor hours.
During March
2019, NY Bay Corporation recorded $275,000 of costs related to factory overhead. Alpha’s overhead application rate is based on direct labor hours. The preset formula for overhead application estimated that $299,000 would be incurred, and 5,700 direct labor hours would be worked. During March, 11,000 hours were actually worked. Use this information to determine the standard overhead rate.