Taylor Manufacturing Company uses a predetermined overhead rate based on machine hours. For the coming year, the company estimated total manufacturing overhead costs to be $4,200,000 and total machine hours to be 70,000 hours. a) Calculate Taylor's predetermined overhead rate. In July, Taylor Manufacturing incurred actual overhead costs of $385,000 and used 6,500 machine hours. b) Determine whether Taylor's manufacturing overhead for July was over-applied or under-applied, and calculate the amount.

Taylor Manufacturing Company uses a predetermined overhead rate based on machine hours. For the coming year, the company estimated total manufacturing overhead costs to be $4,200,000 and total machine hours to be 70,000 hours. a) Calculate Taylor's predetermined overhead rate. In July, Taylor Manufacturing incurred actual overhead costs of $385,000 and used 6,500 machine hours. b) Determine whether Taylor's manufacturing overhead for July was over-applied or under-applied, and calculate the amount.

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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