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Mansfield Technology uses a job-order costing system. Its direct materials consist of hardware and software that it purchases and installs on behalf of its clients. The firm’s direct labor includes salaries of consultants that work at the client’s job site, and its overhead consists of costs such as depreciation, utilities, and insurance related to the office headquarters as well as the office supplies that are consumed serving clients.
The predetermined plantwide overhead rate for Mansfield Technology of $23.60 per direct labor-hour was computed based on the formula of estimated total manufacturing overhead cost of $283,200 divided by an estimated total activity level of 12,000 direct labor-hours. Mansfield Technology incurred actual total manufacturing overhead cost of $269,000 and 11,700 total direct labor-hours during the period.
Required:
Determine the amount of manufacturing overhead cost that would have been applied to all jobs during the period.
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