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6 July, 16:43

Tyler Company applies manufacturing overhead to production at the rate of $5.3 per direct labor hour and ended August with $13,300 underapplied overhead. Actual manufacturing overhead incurred for August amounted to $120,890. Required: How many direct labor hours did Tyler Company incur during August

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  1. 6 July, 17:05
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    118,380.57 labor hours

    Explanation:

    Data provided as per the question

    Actual manufacturing overhead = $120,890

    Under applied overhead = $13,300

    Production rate = $5.3

    The computation of labor hours is shown below:-

    Actual manufacturing overhead - Under applied overhead : Production rate

    = $120,890 - $13,300 : $5.3

    = $120,890 - $2,509.43

    = 118,380.57 labor hours

    Therefore for computing the labor hour we simply applied the above formula.
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