bdarefritz Posts: 1, Reputation: 1 New Member #1 Feb 7, 2008, 10:02 PM
Can't figure it out
Need help with manufacturing overhead apply to work in process
 morgaine300 Posts: 6,561, Reputation: 276 Uber Member #2 Feb 9, 2008, 11:45 PM
Overhead is applied based on some type of activity base. Assuming this is textbook, they'll generally use machine hours, direct labor hours, or direct labor dollars. Then they should give you a rate to use to apply the overhead.

For instance, if the rate is \$35 per machine hour, you check for how many machine hours you actually had that month. If it is 200, then you take the 200 hours times the \$35 rate per hour. For direct labor dollars, they may give it as a rate per one dollar, in which just multiply the same way. Or they sometimes give it as a percent of the labor cost, in which still multiply, but move the decimal since it's a percent. :-)

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