Question

Dukes Corporation used a predetermined overhead rate this year of $2 per direct labor-hour, based on an estimate of 20,000 direct labor-hours to be worked during the year. Actual costs and activity during the year were:

Answer 1

Answer:

A) the underapplied overhead is $1,000

Explanation:

The computation of the under applied or over applied is as follows;

Actual Overhead $38000

Overhead e Applied (18,500 × $2) $37,000

Underapplied $1,000

Since the actual overhead is more than the overhead applied so it would be underapplied overhead

hence, the underapplied overhead is $1,000

The same is to be considered