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Brockton Corporation, which allocates manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations.

Actual manufacturing overhead costs incurred $35,000
Manufacturing overhead allocated to jobs 33,800
Underallocated or overallocated Manufacturing overhead ?

Required:
Calculate the manufacturing overhead and indicate if the remainder is underallocated or overallocated for the year.

User Dominic Farolino
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1 Answer

10 votes
10 votes

Answer:

Underapplied overhead= $1,200

Step-by-step explanation:

Giving the following information:

Actual manufacturing overhead costs incurred $35,000

Manufacturing overhead allocated to jobs 33,800

To calculate the under/over allocation, we need to use the following formula:

Under/over applied overhead= real overhead - allocated overhead

Under/over applied overhead= 35,000 - 33,800

Underapplied overhead= $1,200

User Iulian
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