Question

Waidman Pools manufactures swimming pool equipment Click the icon to view data) Determine the total overallocation or underallocation of manufacturing overhead during the year in the following independent situations. Actual manufacturing costs for the year for Waldman Pools totaled $1,225,000 1. Assume that the company used direct labor hours as the allocation base. 2. Assume that the company used the direct labor cost as the location base 3. Assume that the company used machine hours as the allocation base 4. Were there any situations in which jobs were costed correct? If not, when were they overcosted? When were they undercosted? 1. Determine the total overallocation or underallocation of manufacturing overhead during the year assuming that the company used direct labor hours as the location base. Actual manufacturing costs for the year for Waldman Pools totaled $1.225.000 Determine the total overallocation or underallocation of manufacturing overhead during the year Manufacturing overhead is bys 2. Determine the total overallocation or under location of manufacturing overhead during the year assuming that the company used the direct labor cost as the for Waldman Pools totaled $1.225.000 location base. Actual manufacturing costs for the year

Answer 1

If allocated overheads are more than actual, it is known as overapplied and vice versa

Using Direct labor hours

Overapplied by 1,255,200-1,225,000 = $30,200

2.Overapplied by 1,230,000-1,225,000 = $5,000

3.Underapplied by 1,225,000 – 1,185,000 = $40,000

Overcosting of jobs by $30,200

Closest option

Overcosted by $5000

Under allocation

Undercosted by $40,000