(Underapplied or overapplied overhead) For 2006, Wilhem Co. applied over¬ head to jobs using a predetermined overhead rate of $18.40 per machine hour. This rate was derived by dividing the company’s total budgeted over¬ head by the 48,000 machine hours anticipated for the year.
At the end of 2006, the company’s manufacturing overhead control ac¬ count had debits totaling $889,070. Actual machine hours for the year to¬ taled 48,850.

a. How much was total budgeted overhead for 2006?

b. What amount of overhead was applied to Work in Process Inventory during 2006?

c. During 2006, 950 machine hours were used to complete Job #47. How much overhead should be assigned to this job for the year?

d. Is overhead underapplied or overapplied and by how much?

e. Describe the disposition of the underapplied or overapplied overhead determined in part (d).

f. If Wilhem Co. had used an actual cost system in 2006, what would have been the overhead rate per hour?LO1.