Exercise 14-5 a-c Bramble Company applies manufacturing overhead to jobs on the

Question

Exercise 14-5 a-c Bramble Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are estimated to total $280,896 for the year, and machine usage is estimated at 125,400 hours. For the year, $400,896 of overhead costs are incurred and 130,400 hours are used. Your answer is correct. Compute the manufacturing overhead rate for the year. (Round answer to 2 decimal places, e.g. 1.25.) Manufacturing overhead rate 2.24 per machine hour Attempts: 1 of 5 used What is the amount of under- or overapplied overhead at December 31? Manufactunng Overhead

Explanation / Answer

b)

Total budgeted overhead for actual hours used = Actual hours * Overhead rate per hour

= 130400*2.24 = 292096

Actual overhead cost = 400896

Overapplied manufacturing overhead = Actual overhead - Budgeted overhead = 400896-292096 = 108800

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