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The Adlake Company makes and sells a single product and uses a standard cost sys

ID: 2389159 • Letter: T

Question

The Adlake Company makes and sells a single product and uses a standard cost system. During October, the company budgeted $300,000 in manufacturing overhead cost at a denominator activity of 20,000 machine-hours. At standard, each unit of finished product requires 5 machine-hours. The following cost and activity were recorded during October:

Total actual manufacturing overhead cost incurred $294,000
Units of product completed 3,800
Actual machine-hours worked 19,422
The amount of overhead cost that the company applied to work in process for October was:

$279,300.
$291,330.
$294,000.
$285,000.

Explanation / Answer

$279,300.
$291,330.
$294,000.
$285,000

company will apply actual amount of overhead cost to work in progress