Warhol Company had estimated $1,003,000 of manufacturing overhead (MOH) for the year and 59,000 direct labor...

 

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Warhol Company had estimated $1,003,000 of manufacturing overhead (MOH) for the year and 59,000 direct labor (DL) hours, resulting in a predetermined MOH rate of $17 per DL hour. By the end of that year, the company had actually incurred $891,250 of MOH costs and had used a total of 57,500 DL hours on various jobs. 1. By how much did the company overallocate or underallocate MOH for the year? 2. Was MOH overallocated or underallocated for the year? How do you know? Warhol Company had estimated $1,003,000 of manufacturing overhead (MOH) for the year and 59,000 direct labor (DL) hours, resulting in a predetermined MOH rate of $17 per DL hour. By the end of that year, the company had actually incurred $891,250 of MOH costs and had used a total of 57,500 DL hours on various jobs. 1. By how much did the company overallocate or underallocate MOH for the year? 2. Was MOH overallocated or underallocated for the year? How do you know?

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