Maurice Company allocates overhead using direct labour-hours. For 2016, the estimated and actual labour-hours were 180,000 and
Question:
Maurice Company allocates overhead using direct labour-hours. For 2016, the estimated and actual labour-hours were 180,000 and 167,000 respectively, and the predetermined overhead rate used to apply overhead for the year was $24.80 per direct labour-hour. The manufacturing overhead control T-account showed a debit balance of $183,550 at the end of the year, and this balance was disposed of at the end of the year by closing it to cost of goods sold.
Required:
1. Was manufacturing overhead under- or overapplied?
2. Compute the actual overhead amount incurred over the year.
3. How will end-of-period disposal of this amount impact net income?
Step by Step Answer:
1 Underapplied A debit balance in the Manufacturin...View the full answer
Introduction to Managerial Accounting
ISBN: 978-1259105708
5th Canadian edition
Authors: Peter C. Brewer, Ray H. Garrison, Eric Noreen, Suresh Kalagnanam, Ganesh Vaidyanathan
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