Developing and Using a Predetermined Overhead Rate Assume that the following pre

Question

Developing and Using a Predetermined Overhead Rate Assume that the following predictions were made for 2009 for one of the plants of Milliken & Company: Total manufacturing overhead for the year $42,000,000 Total machine hours for the year 2,000,000 Actual results for February 2009 were as follows: Manufacturing overhead $5,470,000 Machine hours 310,000 (a) Determine the 2009 predetermined overhead rate per machine hour. $Answer (b) Using the predetermined overhead rate per machine hour, determine the manufacturing overhead applied to Work-in-Process during February. $Answer (c) As of February 1, actual overhead was underapplied by $500,000. Determine the cumulative amount of any overapplied or underapplied overhead at the end of February. $Answer

Explanation / Answer

Budget Total manufacturing overhead for the year $42,000,000 Total machine hours for the year 2,000,000 Predetermined Overhead Rate $21 Actual Predetermined Overhead Rate $21 Machine hours 310,000 Overhead Applied $6,820,000 Actual Overhead $5,470,000 Overhead Over-Applied $1,350,000 Overhead Under-Applied- ($500,000) Cumulative Overhead Over-Applied $850,000

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.