Budgeted factory overhead $1,352,000 Budgeted direct labor hours 80,000 Budgeted machine hours 41,600 Actual factory overhead 1,100,000 Actual direct labor hours 87,700 Actual machine hours 40,800 If overhead is applied based on direct labor hours, overapplied/underapplied overhead is (round calculations to 2 significant digits):
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Jackson Inc. listed the following data for 2019:
| Budgeted factory |
$1,352,000 | ||
| Budgeted direct labor hours | 80,000 | ||
| Budgeted machine hours | 41,600 | ||
| Actual factory overhead | 1,100,000 | ||
| Actual direct labor hours | 87,700 | ||
| Actual machine hours | 40,800 | ||
If overhead is applied based on direct labor hours, overapplied/underapplied overhead is (round calculations to 2 significant digits):
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$382,130 overapplied.
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$382,130 underapplied.
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$331,166 underapplied.
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$331,166 overapplied.
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$ − 0 −.
My answer is $226,000 overapplied. But I don't show that answer.
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