Parker Manufacturing Ltd. has a predetermined overhead rate of 150% of direct labor cost. During the month, Parker incurred a total of $120,000 in factory labor costs, of which $95,000 is direct labor and $25,000 is indirect labor. The actual manufacturing overhead incurred was $130,000. A. Compute the amount of manufacturing overhead applied during the month. B. Determine the amount of under- or over applied manufacturing overhead.

Parker Manufacturing Ltd. has a predetermined overhead rate of 150% of direct labor cost. During the month, Parker incurred a total of $120,000 in factory labor costs, of which $95,000 is direct labor and $25,000 is indirect labor. The actual manufacturing overhead incurred was $130,000. A. Compute the amount of manufacturing overhead applied during the month. B. Determine the amount of under- or over applied manufacturing overhead.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 8PB: Queen Bees Honey, Inc., estimated its annual overhead to be $110,000 and based its predetermined...

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