Question: Picl allocates overheads based on machine hours. At the beginning of 2020 its management accountant estimated that the overheads for the year would be 1,500,000

Picl allocates overheads based on machine hours. At the beginning of 2020 its management accountant estimated that the overheads for the year would be 1,500,000 and that the machine hours would be 10,160 hours.

After the year end, the accountant determined that the actual overheads incurred were 1,550,000. The number of machine hours for 2020 was 9,465.

What was the under or over recovery of overheads for 2020?

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