Austin Company uses a job order cost accounting system. The company's executives estimated that direct labor would
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Austin Company uses a job order cost accounting system. The company's executives estimated that direct labor would be $2,000,000 (200,000 hours at $10/hour) and that factory overhead would be $1,500,000 for the current period. At the end of the period, the records show that there had been 180,000 hours of direct labor and $1,200,000 of actual overhead costs. Using direct labor hours as the allocation base, calculate the under- or overapplied overhead for the period.
a. $300,000 underapplied.
b. $150,000 overapplied.
c. $300,000 overapplied.
d. $150,000 underapplied.
Related Book For
Fundamentals Of Corporate Finance
ISBN: 9780135811603
5th Edition
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
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