Synergy Corp. uses a predetermined overhead rate based on direct labor dollars. Synergy Corp. estimated that its 2023 overhead would total $1,500,000 and that 2023 direct labor costs would be $1,000,000. During 2023, actual overhead costs were $1,450,000, and actual direct labor costs were $1,050,000. By how much was Synergy Corp.'s overhead over- or under applied?

Synergy Corp. uses a predetermined overhead rate based on direct labor dollars. Synergy Corp. estimated that its 2023 overhead would total $1,500,000 and that 2023 direct labor costs would be $1,000,000. During 2023, actual overhead costs were $1,450,000, and actual direct labor costs were $1,050,000. By how much was Synergy Corp.'s overhead over- or under applied?

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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