Underapplied and Overapplied Overhead San Antonio Welding Company applies factor
ID: 2427782 • Letter: U
Question
Underapplied and Overapplied Overhead
San Antonio Welding Company applies factory overhead at a rate of $8.20 per direct-labor hour. Selected data for 20X0 operations are as follows (in thousands):
Case 1
Case 2
Direct-labor hours
25
35
Direct-labor cost
$224
$250
Indirect-labor cost
29
43
Sales commissions
22
10
Depreciation, manufacturing equipment
16
33
Direct-materials cost
228
247
Factory fuel costs
36
49
Depreciation, finished-goods warehouse
8
19
Cost of goods sold
415
505
All other factory costs
137
207
1. factory overhead applied.
2. total factory overhead incurred.
3. amount of underapplied or overapplied factory overhead.
Case 1
Case 2
Direct-labor hours
25
35
Direct-labor cost
$224
$250
Indirect-labor cost
29
43
Sales commissions
22
10
Depreciation, manufacturing equipment
16
33
Direct-materials cost
228
247
Factory fuel costs
36
49
Depreciation, finished-goods warehouse
8
19
Cost of goods sold
415
505
All other factory costs
137
207
Explanation / Answer
Total direct labor = 25+35 = 60 hours
hence facotry overhead applied = 60*$8.20 = $492
total facotry overhead incurred
1) indirect labor cost = $72
2)Depreciation, manufactuirng = $49
3)Facotry fuel cost = $85
4)All other factory cost = 344
total overhead = $550
Total direct labor = 25+35 = 60 hours
hence facotry overhead applied = 60*$8.20 = $492
total facotry overhead incurred
1) indirect labor cost = $72
2)Depreciation, manufactuirng = $49
3)Facotry fuel cost = $85
4)All other factory cost = 344
total overhead = $550
c)Factory overhead underapplied = $550 -$492 = $58Related Questions
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