Marigold Company applies overhead on the basis of machine hours. Given the following data, what is the overhead applied and the under- or overapplication of overhead for the period? Estimated annual overhead cost Actual annual overhead cost Estimated machine hours Actual machine hours $3160000 $2900000 350000 280000 O $3160000 applied and $372000 overapplied $2528000 applied and $372000 overapplied O $2900000 applied and neither under- nor overapplied O $2528000 applied and $372000 underapplied

Marigold Company applies overhead on the basis of machine hours. Given the following data, what is the overhead applied and the under- or overapplication of overhead for the period? Estimated annual overhead cost Actual annual overhead cost Estimated machine hours Actual machine hours $3160000 $2900000 350000 280000 O $3160000 applied and $372000 overapplied $2528000 applied and $372000 overapplied O $2900000 applied and neither under- nor overapplied O $2528000 applied and $372000 underapplied

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Description: Marigold Company applies overhead on the basis of machine hours. Given the following data, what is the overhead applied and theunder- or overapplication of overhead for the period?Estimated annual overhead costActual annual overhead costEstimated ma

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Concept explainers

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.

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Question

Marigold Company applies overhead on the basis of machine hours. Given the following data, what is the overhead applied and the
under- or overapplication of overhead for the period?
Estimated annual overhead cost
Actual annual overhead cost
Estimated machine hours
Actual machine hours
$3160000
$2900000
350000
280000
O $3160000 applied and $372000 overapplied
O $2528000 applied and $372000 overapplied
O $2900000 applied and neither under- nor overapplied
O $2528000 applied and $372000 underapplied

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Assume (1) actual machine-hours worked during the period of 54,000 hours, (2) manufacturing overhead applied to production during the period of $432,000, (3) estimated fixed manufacturing overhead of $329,400, and (4) estimated variable manufacturing overhead cost per machine-hour of $2.00. The estimated amount of the allocation base (machine-hours) is closest to: 56,900. 54,900. 54,200. 52,900.
Compute the amount for each of the following. Direct materials used Indirect materials used Direct labor used Indirect labor used Cost of goods manufactured Cost of goods sold (before closing over- or underapplied overhead) Compute the amount that overhead is overapplied or underapplied.