Kevin Aeronautics Company uses a budgeted overhead rate in applying overhead to products on a machine-hour basis for department A and on a direct-labor hour basis for department B. At the beginning of 20X0, the company’s management made the following budget predictions:

Cost records of recent months show the following accumulations for product M89:

1. What is the budgeted overhead rate that should be applied in department A? In department B?
2. What is the total overhead cost of product M89?
3. If 105 units of product M89 are produced, what is its unit cost?
4. At the end of 20X0, actual results for the year’s operations were as follows:

Find the underapplied or overapplied overhead for each department and for the factory as awhole.

  • CreatedNovember 19, 2014
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