5) Darrow Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Last year, the Corporation worked 10,000 direct labor-hours and incurred $80,000 of actual manufacturing overhead cost. If overhead was underapplied by
5) Darrow Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Last year, the Corporation worked 10,000 direct labor-hours and incurred $80,000 of actual manufacturing overhead cost. If overhead was underapplied by
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![5) Darrow Corporation uses a predetermined overhead rate based on direct labor-hours to apply
manufacturing overhead to jobs. Last year, the Corporation worked 10,000 direct labor-hours and
incurred $80,000 of actual manufacturing overhead cost. If overhead was underapplied by
$2,000, the predetermined overhead rate for the Corporation for the year must have been:
A) $7.80 per direct labor-hour
B) $8.00 per direct labor-hour
C) $8.20 per direct labor-hour
D) $8.40 per direct labor-hour
E) None of the above](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F07f215eb-61cc-4692-8b31-adee2e22970e%2Fb433723d-1a62-4dd0-b39b-be49778a234a%2Fbewwopv_processed.jpeg&w=3840&q=75)
Transcribed Image Text:5) Darrow Corporation uses a predetermined overhead rate based on direct labor-hours to apply
manufacturing overhead to jobs. Last year, the Corporation worked 10,000 direct labor-hours and
incurred $80,000 of actual manufacturing overhead cost. If overhead was underapplied by
$2,000, the predetermined overhead rate for the Corporation for the year must have been:
A) $7.80 per direct labor-hour
B) $8.00 per direct labor-hour
C) $8.20 per direct labor-hour
D) $8.40 per direct labor-hour
E) None of the above
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