Chapter 6 Homework Exercises i 2 0.33 points eBook Hint Print References Osborn Manufacturing uses a predetermined overhead rate of $19.20 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $249,600 of total manufacturing overhead for an estimated activity level of 13,000 direct labor-hours. The company actually incurred $247,000 of manufacturing overhead and 12,500 direct labor-hours during the period. Saved Required: 1. Calculate the underapplied or overapplied manufacturing overhead. 2. Assume the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the closing journal entry increase or decrease gross margin? By how much? 1. Manufacturing overhead 2. The gross margin would by by Help Save & CH

Osborn Manufacturing uses a predetermined overiead rate of $19.20 per direct labor-houc. This predetermined rate was based on a cost formula that estimates $249,600 of total manufacturing overhead for an estimated activity level of 13,000 direct labor-hours. The company actually incurred $247,000 of manufacturing overhead and 12,500 direct labor-hours during the period. Required: 1. Calculate the underapplied or overapplied manufocturing overhead. 2. Assume the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the closing journal entry increase or decrease gross margin? By how much