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1. The Overdale plant has two categories of overhead: maintenance and inspection. Costs expected for these categories for the coming year are as follows:

Maintenance	A??L120,000
Inspection	A??L200,000

The plant currently applies overhead during direct labour hours and expected capacity of 80,000 direct labour hours. The following data has been assembled for
use in developing a bid for a proposed job:

Direct materials	A??L1,500
Direct labour	A??L5,000
Machine hours	400
Number of inspections	6
Direct labour hours	750

Using direct labour hours to assign overhead, the total cost of the potential job would be:

1. A??L9,500
2. A??L6,000
3. A??L3,000
4. A??L1,600

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