Applied overhead per direct labour hour

$ 10

Standard direct labour hours allowed for units produced - 16000

Activity volume.

Activity volume		10000	cartons
		20000	direct labour hours

Predetermined fixed overhead rate	12.50		carton
	6.25		per direct labour hour

Fixed overhead applied - $100000

Variable overhead spending variance

$4000

Favourable

What is the actual number of direct labour hours incurred? (Round answer to the nearest whole hour, e.g. 5,275.)

Actual number of direct labour hours

hours

Case 12-66 (Part Level Submission) You have started working as a cost accountant for a firm that has only been in business for one month. The firm is able to buy a new type of biodegradable plastic at a fixed price of $100 per roll. The plastic is then cut and sealed to make garbage bags. Fixed factory overhead is estimated to be $125,000 per month. During this past month, 8,000 cartons of garbage bags were produced, which represents 80% of the activity volume. You are given the following information: Rolls of plastic used Variable overhead incurred $61,000 Overhead efficiency variance $5,000 U Standard costs per carton of garbage bags: Labour hours 2 Wage rate $8 per hour Total overhead $20 Rolls of plastic 40 0.004 rolls Calculate the following