Help Seve & Exh Baka Corporation applies manufacturing overhead on the basis of

Question

Help Seve & Exh Baka Corporation applies manufacturing overhead on the basis of direct labor hours. At the beginning of the most recent year, the predetermined overhead rate on total estimated overhead of $245,400 and 10,400 estimated direct labor -hours. Actual manufacturing overhead for the year amounted to $245,800 and actual direct labor-hours were 6,500. company based its The overhead for the year was: (Round your intermediate calculations to 2 decimal places.) Multiple Choice $92,000 underapplied $92.400 underapplied $92.000 overapplied $92.400 overapplted search

Explanation / Answer

Predetermined overhead rate=Total estimated overhead/Estimated direct labor hours

=(245400/10400)=$23.60

Hence applied overhead=(23.60*6500)=$153400

Hence underapplied overhead=(245800-153400)=$92400.

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