Question

Where are they getting the $8500 amount? I understand the rest.

Stephenson Company's computer system recently crashed, erasing much of the Company's financial data. The following accounting information was discovered soon afterwards on the CFO's backup computer disk. Direct labor cost incurred during the period amounted to 1.5 times the factory overhead. The CFO of Stephenson Company has asked you to recalculate the following accounts and report to him by week's end. What should be the amount of total manufacturing cost? $138, 500. $131,000. $142, 500. $121,000. $131,000 = $8, 500 Direct Materials + $73, 500 Direct Labor + $49,000 Overhead Where $73, 500 = 1.5($49,000)