Question

The estimated total manufacturing overhead cost is $200,000. The estimated total amount of the allocation base is 40,000 direct labor-hours. The actual total manufacturing overhead cost for the period is $220,000 and the actual direct labor hours worked on all jobs during the period is 41,000 hours. The total under-applied (over-applied) overhead for the period is:a. $20,000 under-appliedb. $20,000 over-appliedc. $15,000 under-appliedd. $15,000 over-applied

Answer 1

$15,000 under applied

Actual overhead of $220,000 minus applied overhead of $205,000 (200,000/40,000 direct labor hours • 41,000 actual hours worked) equals 15,000 under applied

Step-by-step explanation: