Answer:
Instructions are listed below.
Explanation:
Giving the following information:
Sykora, Inc., which uses a predetermined overhead rate based on direct labor hours, estimated total overhead for the year to be $12,000,000 and total direct labor hours to be 320,000 hours.
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= 12,000,000/320,000= $37.5 per direct labor hour
In April, Sykora incurred actual overhead costs of $1,050,000 and used 30,000 hours.
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 37.5*30,000= $1,125,000
Over/under allocation= real MOH - allocated MOH
Over/under allocation= 1,050,000 - 1,125,000= 75,000 overallocated
