Auditing & Assurance Services
Auditing & Assurance Services
6th Edition
ISBN: 9780077862343
Author: LOUWERS, Timothy J.
Publisher: Mcgraw-hill Education,
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Chapter 2, Problem 12RC
To determine

State the reason that an auditor obtain an understanding of the client’s internal control system.

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Krypton Corp. estimated manufacturing overhead for the year to be $842,000. At the end of the year, actual direct labor hours were 48,300 hours, the actual manufacturing overhead was $919,500, and manufacturing overhead was overapplied by $76,200. If the predetermined overhead rate is based on direct labor hours, what were the estimated direct labor hours at the beginning of the year used in the predetermined overhead rate?
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