Lonestar Corporation uses a job-order costing system to account for product costs. The following information pertains to
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Lonestar Corporation uses a job-order costing system to account for product costs. The following information pertains to 2018:
Materials Placed into Production | $140,000 |
Indirect Labor | 40,000 |
Direct Labor (10,000 hours) | 160,000 |
Depreciation of Factory Building | 60,000 |
Other Factory Overhead | 100,000 |
Increase in Work-in-Process Inventory | 30,000 |
Factory overhead rate is $18 per direct labor hour.
What is the amount of under- or overapplied overhead for Lonestar Corporation in 2018?
a. | $20,000 underapplied | |
b. | $40,000 overapplied | |
c. | $20,000 overapplied | |
d. | $40,000 underapplied |
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