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A company works on three jobs and incurs the following: Direct materials - $50,000 and Direct labor - $100,000. The company uses a predetermined overhead rate of 60% of direct labor costs. How much overhead will be allocated to the three jobs?

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ijaz4308

Answer:

$60,000

Explanation:

The amount of overheads which shall be allocated to the three projects shall be determined using the following mentioned formula:

Overhead amount=overhead rate* direct labor costs

In the given question

overhead rate=60%

direct labor costs=$100,000

Overhead amount=60%*100,000

                              =$60,000

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