Question

Refer to the data in Exercise 4-12.
Sinclair Company manufactures a line of lightweight running shoes. CEO Andrew Sinclair estimated that the company would incur $2,500,000 in manufacturing overhead during the coming year. Additionally, he estimated the company would operate at a level requiring 200,000 direct labor hours and 500,000 machine hours.
At the end of the year, Sinclair Company had worked 202,000 direct labor hours, used
348,000 machine hours, and incurred $2,515,000 in manufacturing overhead.

Required
a. If Sinclair Company used direct labor hours as its manufacturing overhead application base, how much overhead was applied to jobs during the year?
b. Using direct labor hours as the application base, was manufacturing overhead under- or
overapplied for the year? By how much?
c. If Sinclair Company used machine hours as its manufacturing overhead application base, how much overhead was applied to jobs during the year?
d. Using machine hours as the application base, was manufacturing overhead under- or
overapplied for the year? By how much?



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  • CreatedFebruary 21, 2014
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