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+ Scenario #3 Budget Actual Materials $4,000 $4,000 Labor $5,000 $5,000 Overhead $1,200 $1,000 Total $10,200 $10,000 Q1: what is the allocation rate under
+ Scenario #3 Budget Actual Materials $4,000 $4,000 Labor $5,000 $5,000 Overhead $1,200 $1,000 Total $10,200 $10,000 Q1: what is the allocation rate under normal costing Overhead Materials Overhead rate Q2: what are total costs under normal costing Materials Labor Allocated MOH Total Q3: what is the allocation rate under actual costing Overhead Materials Overhead rate Q4: what are total costs under actual costing Materials Labor Allocated MOH Total Q5: is overhead over or under allocated? Why? Q6: if we use the write off approach (adjust over/under allocation by writing off the amount to COGS), what happens to gross margin after adjustment?
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