Question

Dori Castings is a job order shop that uses a standard cost system. Manufacturing overhead costs are applied on the basis of standard direct labor-hours. The amount of fixed manufacturing overhead that Dori would apply to finished production would be___________.

a. the standard hours allowed for the actual units of finished output times the standard fixed manufacturing overhead rate per direct labor-hour.
b. the standard units of output for the actual direct labor-hours worked times the standard fixed manufacturing overhead rate per unit of output.
c. the actual direct labor-hours times the standard fixed manufacturing overhead rate per direct labor-hour.
d. the actual fixed manufacturing overhead cost per direct labor-hour times the standard hours allowed.

Answer 1

Answer: The correct answer is

"<the standard hours allowed for the actual units of finished outpu> × <the standard fixed manufacturing overhead rate per direct labor hour>."

Explanation: The amount of fixed manufacturing overhead that Dori would apply to finished production would be = <the standard hours allowed for the actual units of finished outpu> × <the standard fixed manufacturing overhead rate per direct labor hour>