Ocean Technical Services Applies Manufacturing Overhead Costs to Products at a Predetermined

Ocean Technical Services applies manufacturing overhead costs to products at a predetermined rate of $70 per direct labor hour. One customer has requested a bid on a special order of a product. Estimates for this order include: direct materials $50,000; direct labor 900 direct labor hours @ $30 per hour; and a markup rate of 25%.
-Estimated total product costs for this special order equal:

A) $77,000.
B) $97,000.
C) $140,000.
D) $175,000.

Correct Answer:

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