This preview shows pages 1–2. Sign up to view the full content.
This preview has intentionally blurred sections. Sign up to view the full version.View Full Document
Unformatted text preview: a. POHR = Estimated (or Budgeted or Forecasted) Annual Overhead/Estimated Annual Activity Level i. Labor Intensive environment = focus on DL costs ii. Highly automated environment = focus on DM costs 2. Apply overhead to production throughout the year a. Applied MOH = POHR x Actual Activity Level 3. Reconcile the difference b/w actual and applied (called overhead variance) a. b/c youre estimations arent perfect The MOH costs (actual and applied) are accumulated in a temporary MOH account that is closed to COGS at the end of the period Debit Actual MOH Credit Applied MOH...
View Full Document
- Spring '08