Watercraft, Inc., employs Vladimir as a sales agent for a trial period. At the end of the period, Watercraft and Vladimir disagr
1 answer:
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Answer:
a. Under applied by $9,000
Explanation:
Budgeted overheads = $1,240,000
Budgeted overheads = 400,000
Budgeted rate per hour = $1,240,000/400,000 = $3.10
Actual overhead = $1,200,000
Actual Hours = 390,000
Actual Rate per hour = $3.077
budgeted overhead for actual hours = 390,000 $3.10 = $1,209,000
Thus, overheads under applied = Standard - Actual = $1,209,000 - $1,200,000 = $9,000
Since actual overheads are less than budgeted it is under applied in case it was more than budgeted then i would be over applied.
Final Answer
a. Under applied by $9,000