Staples - Johnstown 590 Galleria Dr, Johnstown PA 15904 Phone Number: (814) 262-9096
The distribution of manufacturing overhead costs to individual product unit, or production batches generally, requires a base or a cost driver, to which reference a rate, known as material burden rate applies. Material burden is the amount of manufacturing overhead costs that a unit of the base carries.
That is, total overhead cost is highly correlated with the total amount of production material used. If total overhead cost is $10,000 and the dollar amount of production material used for all products is $50,000, calculate the overhead cost per material dollar as $10,000/$50,000 = $0.20 per material dollar.ssume that for the entire production, the business conducted 10 tests, 15 setups and 20 cleaning jobs. Thus, the unit cost for each overhead activity is as follows: $5,000/10 tests = $500 per test, $3,000/15 setups = $200 per setup and $2,000/20 cleaning jobs = $100 per cleaning job.