Vaughn Music Company makes custom marimbas and xylophones. Since much of the wor
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Vaughn Music Company makes custom marimbas and xylophones. Since much of the work on these musical instruments is done by hand, the company uses direct labor hours as its manufacturing overhead application base. The company’s annual budgeted overhead costs for 73,300 direct labor hours totaled $586,400.
Exercise 4-20 Your answer is partially correct. Try again. Vaughn Music Company makes custom marimbas and xylophones. Since much of the work on these musical instruments is done by hand, the company uses direct labor hours as its manufacturing overhead application base. The company's annual budgeted overhead costs for 73,300 direct labor hours totaled $586,400. (a) Assume that during the year, the company incurred manufacturing overhead totaling $584,400 for 73,300 direct labor hours. By how much was manufacturing overhead under- or overapplied for the year? (Enter negative amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). overhead overapplied Overhead s 2000 (b) Assume that during the year, the company incurred manufacturing overhead totaling $584,400 for 74,550 direct labor hours. By how much was manufacturing overhead under- or overapplied for the year? (Enter negative amount using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) overapplied Overhead $ Overhead s (c) Assume that during the year, the company incurred manufacturing overhead totaling $599,000 for 74,550 direct labor hours. By how much was manufacturing overhead under- or overapplied for the year? (Enter negative amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) underapplied Overhead $Explanation / Answer
Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars Amount Estimated budgeted overhead 586,400.00 Estimated direct labour hours 73,300.00 Predetermined overhead rate = 586,400/73,300 8.00 case a Actual Manufacturing overhead 584,400.00 Applied manufacturing overhead = 73,300*8 586,400.00 Overapplied overhead = 586,400 - 584,400 2,000.00 Since applied overhead is more than actual overhead , overhead is overapplied case b Actual Manufacturing overhead 584,400.00 Applied manufacturing overhead = 74,550*8 596,400.00 Overapplied overhead = 596,400 - 584,400 12,000.00 Since applied overhead is more than actual overhead , overhead is overapplied case c Actual Manufacturing overhead 599,000.00 Applied manufacturing overhead = 74,550*8 596,400.00 Underapplied overhead = 596,400 - 599,000 2,600.00 Since applied overhead is less than actual overhead , overhead is underapplied
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