Calculating Departmental Overhead Rates and Applying Overhead to Production

At the beginning of the year, Glaser Company estimated the following:

	Assembly Department			Testing Department			Total
Overhead	$394,000			$401,880			$795,880
Direct labor hours	64,000			47,360			111,360
Machine hours	118,500			63,990			182,490

Glaser uses departmental overhead rates. In the assembly department, overhead is applied on the basis of direct labor hours. In the testing department, overhead is applied on the basis of machine hours. Actual data for the month of March are as follows:

	Assembly Department			Testing Department			Total
Overhead	$43,340			$44,207			$87,547
Direct labor hours	7,040			5,210			12,250
Machine hours	13,035			7,039			20,074

Required:

1. Calculate the predetermined overhead rates for the assembly and testing departments. Round your answers to the nearest cent.

Assembly department overhead rate	$ per direct labor hour
Testing department overhead rate	$ per machine hour

2. Calculate the overhead applied to production in each department for the month of March. If required, round your answers to nearest whole value.

Assembly department	$
Testing department	$

3. By how much has each department's overhead been overapplied? Underapplied?

Assembly department		$
Testing department		$