In: Accounting
Hipster Company applies overhead based on direct labor hours. At the beginning of the year January 1, Hipster estimates Overhead cost to be $450,000 and Direct Labor hours to be 90,000. During January, Jones has 6,700 actual direct labor hours.
31. Refer to Figure 5-1
What is the predetermined overhead rate?
a. |
$6 per direct labor hour |
b. |
$5 per direct labor hour |
c. |
$4 per machine hour |
d. |
$44,000 |
e. |
none of these |
32. Refer to Figure 5-1. What is the amount of overhead applied for January?
a. |
$40,200 |
b. |
$66,000 |
c. |
$44,000 |
d. |
$33,500 |
e. |
$480,000 |
33. Refer to Figure 5-1. If the actual overhead for January is $41,000, what is the overhead variance and is it overapplied or underapplied?
a. |
$800 underapplied |
b. |
$800 overapplied |
c. |
$7,500 underapplied |
d. |
$3,000 overapplied |
e. |
none of these |
1) predetermined overhead rate = Estimated overhead /estimated direct labor hours
= 450000/90000
= $ 5 per DLH
Correct option is " B"
2) amount of overhead applied = Actual hours* overhead rate
= 6700 * 5
= $ 33500
correct option is " D"
3)Under -applied / (Over-applied) = Actual - applied
= 41000-33500
= 7500 under -applied
correct option is " C"