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Solution to lecture-2 illustration question

Solution to lecture-2 illustration question - overhead –...

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SOLUTION TO LECTURE-2 ILLUSTRATION QUESTION 3-33 NOTE: Budgeted sales revenue, although given in the exercise, is irrelevant to the solution. 1. Predetermined overhead rate = (a) = $32.50 per machine hour (b) = $26.00 per direct-labor hour (c) = $2.00 per direct-labor dollar or 200% of direct-labor cost *Budgeted direct-labor cost = 25,000 × $13 2. Actual manufacturi ng
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Unformatted text preview: overhead – applied manufactur ing overhead = overapplied or underapplied overhead (a) $690,000 – (22,000) ($32.50) = $25,000 overapplied overhead (b) $690,000 – (26,000) ($26.00) = $14,000 underapplied overhead (c) $690,000 – ($364,000 † )(200%) = $38,000 overapplied overhead † Actual direct-labor cost = 26,000 × $14...
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