Overheads applied are calculated by: O a. OAR times the estimated cost driver activity O b. Budgeted production overheads divided by the budgeted cost driver activity O c. OAR times the actual cost driver activity O d. Cost driver divided by the OAR
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.
![Overheads applied are calculated by:
O a. OAR times the estimated cost driver activity
O b. Budgeted production overheads divided by the budgeted cost driver activity
O c. OAR times the actual cost driver activity
O d. Cost driver divided by the OAR](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F50888a09-9f3d-411b-8084-aa61b1732a50%2Fd532459b-b446-4ce3-a1c1-25d92574e0bd%2F6wwe06_processed.jpeg&w=3840&q=75)
![Jacobson & Sons Manufacturing Company reports the following information for 20X7:
Budgeted factory overhead
Budgeted direct labour costs
Budgeted direct labour hours
Actual factory overhead
$725,000
$450,000
50,000
$735,000
$432,000
51,300
Actual direct labour costs
Actual direct labour hours
Given that overhead is applied based on direct labour hours, what entry would Jacobson &
Sons Manufacturing make to close the manufacturing overhead account?
O a. Debit Manufacturing Overhead $36,0003; Credit Cost of Goods Sold $36,000
O b. Debit Manufacturing Overhead $8,850; Credit Cost of Goods Sold $8,850
O c. Debit Cost of Goods Sold $36,00; Credit Manufacturing Overhead $36,000
O d. Debit Cost of Goods Sold $8,850; Credit Manufacturing Overhead $8,850](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F50888a09-9f3d-411b-8084-aa61b1732a50%2Fd532459b-b446-4ce3-a1c1-25d92574e0bd%2Fxaruuum_processed.jpeg&w=3840&q=75)
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