Cost Allocation for Kleyman Company
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The controller of Kleyman Company estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below:
Wall Mirrors Specialty Windows
Total expected units produced 8,000 7,000
Total expected material moves 300 900
Expected direct labor-hours per unit 5 7
The total materials handling cost for the year is expected to be 34,600.
Reference: 8-11
If the materials handling cost is allocated on the basis of direct labor-hours, how much of the total materials handling cost should be allocated to the wall mirrors? (Round off your answer to the nearest whole dollar).
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Solution Summary
The solution explains the calculation of cost allocation given the allocation base in a brief calculation.
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