59. Aberge Company's manufacturing overhead is 60% of its total conversion costs. If direct labor is $38,000 and if direct materials are $21,000, the manufacturing overhead is: Givens: Manufacturing overhead = 0.60 × Conversion cost Direct = $38,000 Conversion cost = Direct labor + Manufacturing overhead Conversion cost = $38,000 + Manufacturing overhead Conversion cost = $38,000 + 0.60 × Conversion cost 0.40 × Conversion cost = $38,000 Conversion cost = $38,000 ÷ 0.40 Conversion cost = $95,000 Manufacturing overhead = 0.60 × Conversion cost Manufacturing overhead = 0.60 × $95,000 Manufacturing overhead = $57,000 AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Measurement Blooms: Apply Difficulty: 3 Hard Learning Objective: 01-01 Identify and give examples of each of the three basic manufacturing cost categories. Topic: General Cost Classifications 60. During the month of September, direct labor cost totaled $11,000 and direct labor cost was 40% of prime cost. If total manufacturing costs during September were $73,000, the manufacturing overhead was:
59. Aberge Company's manufacturing overhead is 60% of its total conversion costs. If direct labor is $38,000 and if direct materials are $21,000, the manufacturing overhead is: Givens: Manufacturing overhead = 0.60 × Conversion cost Direct = $38,000 Conversion cost = Direct labor + Manufacturing overhead Conversion cost = $38,000 + Manufacturing overhead Conversion cost = $38,000 + 0.60 × Conversion cost 0.40 × Conversion cost = $38,000 Conversion cost = $38,000 ÷ 0.40 Conversion cost = $95,000 Manufacturing overhead = 0.60 × Conversion cost Manufacturing overhead = 0.60 × $95,000 Manufacturing overhead = $57,000 AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Measurement Blooms: Apply Difficulty: 3 Hard Learning Objective: 01-01 Identify and give examples of each of the three basic manufacturing cost categories. Topic: General Cost Classifications 60. During the month of September, direct labor cost totaled $11,000 and direct labor cost was 40% of prime cost. If total manufacturing costs during September were $73,000, the manufacturing overhead was: