Peak Manufacturing applies manufacturing overhead based on direct labor hours as the allocation volume. Information for August is as follows: Estimated direct labor: 5,500 hours at $15.50 per hour Estimated manufacturing overhead: $264,000 How much overhead will be allocated during August to products with a direct labor of 4 hours?

Peak Manufacturing applies manufacturing overhead based on direct labor hours as the allocation volume. Information for August is as follows: Estimated direct labor: 5,500 hours at $15.50 per hour Estimated manufacturing overhead: $264,000 How much overhead will be allocated during August to products with a direct labor of 4 hours?

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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The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning February 1 would be 3,150,000, and total direct labor costs would be 1,800,000. During February, the actual direct labor cost totalled 160,000, and factory overhead cost incurred totaled 283,900. a. What is the predetermined factory overhead rate based on direct labor cost? b. Journalize the entry to apply factory overhead to production for February. c. What is the February 28 balance of the account Factory OverheadBlending Department? d. Does the balance in part (c) represent over- or underapplied factory overhead?
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