1) In November 2017, a cost accountant estimates next year’s total manufacturing overhead at $790,000. She...

1) In November 2017, a cost accountant estimates next year’s total manufacturing overhead at $790,000. She is experimenting with 3 possible bases or denominators to calculate the overhead rate. The three possible overhead bases for 2018 are: 27,000 direct labor hours, $505,000 direct labor dollars, and 3,800 machine hours.

At the end of the year, the actual amounts were: $810,000 overhead, 28,000 direct labor hours, $515,000 direct labor cost, and 4,000 machine hours. Required: a) calculate the three overhead rates. b) By using the three different overhead rates, calculate overhead applied by each rate. c) For each overhead rate, calculate the over or under applied overhead at year end.

Expert Solution

ekkarill92 answered 2 years ago

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