Tiffany charges manufacturing overhead to products by using a predetermined application rate, computed on the basis of labor hours. The following data pertain to the current year. Budgeted manufacturing overhead: $3,750,000 Actual manufacturing overhead $3,767,500 Budgeted labor hours: 125,000 Actual labor hours: 126,500 Which of the following choices is the correct status of manufacturing overhead at year-end? Multiple Choice оо Overapplied by $27,500 Underapplied by $27,500. Overapplied by $45,000. Overapplied by $17,500. Underapplied by $17,500.
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.
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Tiffany charges manufacturing overhead to products by using a predetermined application rate, computed on the basis of labor hours. The following data pertain to the current year:
Budgeted manufacturing overhead: $3,750,000
Actual manufacturing overhead: $3,767,500
Budgeted labor hours: 125,000
Actual labor hours: 126,500
Which of the following choices is the correct status of manufacturing overhead at year-end?
Multiple Choice
O Overapplied by $27,500.
Underapplied by $27,500.
O Overapplied by $45,000.
O Overapplied by $17,500.
Underapplied by $17,500.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3a9774d9-f099-4e1f-bb0b-6ba18be133a9%2Fad8a9c9e-43cc-4040-aee6-582debbb8b25%2F6aevpl8_processed.jpeg&w=3840&q=75)
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