Coleridge Company estimates that its production workers will work 143,000 direct labor hours during the upcoming period and that overhead costs will amount to $1,287,000O. Assume overhead to be allocated on the basis of direct labor hours. What predetermined overhead rate would be used to apply overhead to production during the period? Multiple Choice $9.00 per direct labor hour $0.97 per direct labor hour $0.97 per unit $9.00 per unit

Coleridge Company estimates that its production workers will work 143,000 direct labor hours during the upcoming period and that overhead costs will amount to $1,287,000O. Assume overhead to be allocated on the basis of direct labor hours. What predetermined overhead rate would be used to apply overhead to production during the period? Multiple Choice $9.00 per direct labor hour $0.97 per direct labor hour $0.97 per unit $9.00 per unit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

100%

Coleridge Company estimates that its production workers will work 143,000 direct labor hours during the upcoming period and that
overhead costs will amount to $1,287,000. Assume overhead to be allocated on the basis of direct labor hours. What predetermined
overhead rate would be used to apply overhead to production during the period?
Multiple Choice
$9.00 per direct labor hour
$0.97 per direct labor hour
$0.97 per unit
$9.00 per unit

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