Company overhead application rate

Reference no: EM13145552

Johnson Auto Body uses a job order cost system. Overhead is applied to jobs on the basis of direct labor hours. During the current period, was charged $425 in direct materials, $475 in direct labor, and $190 in overhead. If direct labor costs an average of $16 per hour, the company's overhead application rate is:

A) $7.27 per direct labor hour.

B) $6.40 per direct labor hour.

C) $17.50 per direct labor hour.

D) $40 per direct labor hour.

Reference no: EM13145552

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