Question

Question 4 View Policies Show Attempt History Current Attempt in Progress - Your answer is partially correct. Concord Music Company makes custom marimbas and xylophones. Since much of the work on these musical instruments is done by hand, the company uses direct labor hours as its manufacturing overhead application base. The company's annual budgeted overhead costs for 73,500 direct labor hours totaled $588,000. (a) Assume that during the year, the company incurred manufacturing overhead totaling $590,000 for 73,500 direct labor hours. By how much was manufacturing overhead under-or overapplied for the year? (Enter negative amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Underapplied Overhead $ (b) Assume that during the year, the company incurred manufacturing overhead totaling $590,000 for 73,950 direct labor hours. By how much was manufacturing overhead under-or overapplied for the year? (Enter negative amount using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) (Overapplied Overhead $ C (c) Assume that during the year, the company incurred manufacturing overhead totaling $594,000 for 73,950 direct labor hours. By how much was manufacturing overhead under-or overapplied for the year? (Enter negative amount using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Underapplied Overhead $ [

Answer 1

Overhead rate = 588000/73500 = 8 per labor hour

a) Applied overhead = 73500*8 = 588000

Actual overhead = 590000

Under applied overhead by $2000

b) Applied overhead = 73950*8 = 591600

Actual overhead = 590000

Over applied overhead by $1600

c) Applied overhead = 73950*8 = 591600

Actual overhead = 594000

Under applied overhead by 2400