Using the dual rate approach, if the planned labor hours are 8,500 at a rate of $120 per hour, and the actual labor hours amount to 9,500 at $110 per hour, what is the total labor cost?

Multiple choice question for Department Costs, Common Costs and Revenues. Select an option, then review the explanation below.

Explanation

To find the total cost using the dual rate method, multiply the budgeted hours by the budgeted rate (8,500 × $120 = $1,020,000) and the actual hours by the actual rate (9,500 × $110 = $1,045,000), then add both results: $1,020,000 + $1,045,000 = $2,065,000.

Practice related questions from the same subject.

1.Which of the following approaches are used to assign costs among reciprocal support departments?
2.In the incremental cost allocation approach, what is the term for the cost object user that holds the second position in the ranking sequence?
3.What is the name of the technique that distributes the expenses of support departments to both operating and other support departments?
4.Which cost allocation technique assigns support department expenses to operating departments by accounting for all mutual services exchanged among support departments?
5.In the incremental approach, the party assigned the highest priority in distributing shared costs is known as the ____________?

Using the dual rate approach, if the planned labor hours are 8,500 at a rate of $120 per hour, and the actual labor hours amount to 9,500 at $110 per hour, what is the total labor cost?

Explanation

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