A company estimated 129,411 direct labor hours and $798,195 in overhead. The actual overhead was $612,116, and there were 195,635 direct labor hours. What is the total applied overhead? Round to the nearest penny, two decimal places
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
a) A company estimated 129,411 direct labor hours and $798,195 in
b) 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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The overhead is applied to the production on the basis of predetermined overhead rate. The predetermined overhead rate is calculated as estimated overhead cost divided by estimated base activity.
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