I'm asked to calculate the product cost.
Direct Material - $300
Direct Labor (20 hours at $15 per Hour) - $300
Manufacturing overhead (The predetermined rate is $24 per direct-labor hour) - $400
TOTAL = $1000
* Each model requires 20 hours of direct labor.
I have already calculated the departmental predetermined overhead rate. The departmental overhead rate is $30 and it is correct.
I just don't know what to do with it now....
What I did was $30 x 20 hours and that was $600. Then I did $600 + 300 + 300 = $1200. But that's wrong. Any suggestions?
Thanks ahead of time!