An advertising agency is estimating costs for advertising a music festival. The job will require 230 direct labor hours at a cost of $56 per hour. Overhead costs are applied at a rate of $68 per direct labor hour. What is the total estimated cost for this job?

Question

Business

Stella Dudley

5 July, 01:20

An advertising agency is estimating costs for advertising a music festival. The job will require 230 direct labor hours at a cost of $56 per hour. Overhead costs are applied at a rate of $68 per direct labor hour. What is the total estimated cost for this job?

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Answers (1)

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Mackenzie Hunt · Answer 1

The total estimated cost for this job is $28,520

Explanation:

In order to calculate the total estimated cost for this job we would have to make the following calculation:

Total estimated cost=Total direct labor cost+Actual overhead applied cost

Total direct labor cost=total required labour hours*cost per direct labour hour

hence, Total direct labor cost=230*$56

Total direct labor cost=$12,880

Actual overhead applied cost=total required labour hours*Appliead overhead cost

hence, Actual overhead applied cost=230*$68

Actual overhead applied cost=$15,640

Therefore, Total estimated cost=$12,880+$15,640

Total estimated cost=$28,520

The total estimated cost for this job is $28,520