1. Accounting is an information system that provides essential data about the economic activities of an entity to various users to aid them in making informed judgments and decisions.

True

False

2. A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $360,000 and direct labor hours would be 45,000. Actual factory overhead costs incurred were $377,200, and actual direct labor hours were 47,000. What is the amount of overapplied or underapplied manufacturing overhead at the end of the year?

$16,000 overapplied.

$16,000 underapplied.

$1,200 overapplied.

$1,200 underapplied.