Question
4- 24 Budgeted manufacturing overhead rate, allocated manufacturing overhead. Gammaro Company uses normal costing. It allocates manufacturing overhead costs using a budgeted rate per machine-hour.
4-24 Budgeted manufacturing overhead rate, allocated manufacturing overhead. Gammaro Company uses normal costing. It allocates manufacturing overhead costs using a budgeted rate per machine-hour. The following data are available for 2017:
| Budgeted manufacturing overhead costs | $4,600,000 |
| Budgeted machine-hours | 184,000 |
| Actual manufacturing overhead costs | $4,830,000 |
| Actual machine-hours | 180,000 |
Required:
- Calculate the budgeted manufacturing overhead rate.
- Calculate the manufacturing overhead allocated during 2017.
- Calculate the amount of under- or overallocated manufacturing overhead. Why do Gammaros managers need to calculate this amount?
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Managerial Accounting Tools for Business Decision Making
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
7th edition
978-1118334331, 1118334337, 978-1119036449, 1119036445, 978-1119036432
