Nexus Components had estimated manufacturing overhead of $300,000. At year-end, actual labor hours were 20,000, actual overhead was $285,000, and overhead was over applied by $9,000. What were the estimated direct labor-hours at the beginning of the year used to compute the predetermined rate?

Nexus Components had estimated manufacturing overhead of $300,000. At year-end, actual labor hours were 20,000, actual overhead was $285,000, and overhead was over applied by $9,000. What were the estimated direct labor-hours at the beginning of the year used to compute the predetermined rate?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 23Q: If a factory operates at 100% of capacity one month, 90% of capacity the next month, and 105% of...

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Can you help me solve this general accounting problem with the correct methodology?

Nexus Components had estimated manufacturing overhead of
$300,000. At year-end, actual labor hours were 20,000, actual
overhead was $285,000, and overhead was over applied by
$9,000.
What were the estimated direct labor-hours at the beginning of the
year used to compute the predetermined rate?

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