Question

Tom’s Tool & Die uses a predetermined factory overhead rate based on machine-hours. For August, Tom’s budgeted overhead was $609,500 based on a budgeted volume of 53,000 machine-hours. Actual overhead amounted to $520,000 with actual machine-hours totaling 45,500. Required: What was over- or underapplied manufacturing overhead in August? (Do not round intermediate calculations.)

Answer 1

Page No Deto * Calculation ! Predetermined reate = Budgeted overhead Budgeted machine = 609900 53000 = $ 11:50 Pex machinebou Applied overhead - Predetermined & liate Actual machine have = $11.50 X 45500 = 9523250 less Appued over head Actual overhead Overapplied overhead = = = $ 523250 I 520.000 $ 3250 overhead is over applied by 93250, ovel applied because appued overhead is more than actual overhead incurredo Irirst Calculate predetermined liate so that I we can calculate applied overhead than take difference of actual & applied overheet to calculate over or under applied overhead