Answer:
Product X = $20,000
Product Y = $12,000
Explanation:
First determine the total direct labor costs :
Product X ( $20 × 2,000) = $40,000
Product Y ( $30 × 800) = $24,000
Total Labor Cost = $64,000
Use the total direct labor costs to find the overhead application rate as follows :
Predetermined Overhead rate = $32,000 ÷ $64,000
= $0.50
Then Allocate this to Product X and Product Y
Product X ($0.50 × $40,000) = $20,000
Product Y ($0.50 × $24,000) = $12,000
