Charm Industries is a job lot manufacturer. The budget for the month of July calls for 7,500 direct labor hours to be worked. Budgeted overhead is $75,000 with a predetermined rate of $9 per hour. Overhead is applied based on actual direct hours worked. Actual direct hours were 7,800 and actual overhead spending was $85,500. What was the under-applied or over-applied overhead for the month of July? Over-applied is shown as a negative number.

Charm Industries is a job lot manufacturer. The budget for the month of July calls for 7,500 direct labor hours to be worked. Budgeted overhead is $75,000 with a predetermined rate of $9 per hour. Overhead is applied based on actual direct hours worked. Actual direct hours were 7,800 and actual overhead spending was $85,500. What was the under-applied or over-applied overhead for the month of July? Over-applied is shown as a negative number.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter3: Process Cost Systems

Section: Chapter Questions

Problem 4E: The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the...

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