A company estimated 111,680 direct labor hours and $810,549 in overhead. The actual overhead was $875,663, and there were 108,349 direct labor hours. How much is overhead under- or over- applied? Round to the nearest penny, two decimal places. Enter an overapplied overhead as a negative amount. For example, if it is overapplied by 500.00, the input would be -500.00 do not use parenthesis.

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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A company estimated 111,680 direct labor hours and $810,549 in overhead. The actual overhead was $875,663, and there were 108,349 direct labor hours. How much is overhead under- or over- applied? Round to the nearest penny, two decimal places. Enter an overapplied overhead as a negative amount. For example, if it is overapplied by 500.00, the input would be -500.00 do not use parenthesis.

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Over/Under Applied Overhead:

The difference between manufacturing overhead cost applied to work in process and manufacturing overhead cost actually incurred by the business during the period is characterized as over or under-applied manufacturing overhead.

Over-applied manufacturing overhead occurs when the manufacturing overhead cost applied to work in process exceeds the manufacturing overhead cost actually incurred during a period. Under-applied manufacturing overhead occurs when the manufacturing overhead cost applied to work in process is less than the manufacturing overhead cost actually incurred during a period.

 

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