Paul Company used a predetermined overhead rate during the year just completed of $3.50 per direct labour hour,based on an estimate of 22,000 direct labour hours to be worked during the year.Actual overhead cost and activity during the year were: The underapplied or overapplied overhead for the year was:
A) $13,000 underapplied.
B) $10,500 overapplied.
C) $2,500 overapplied.
D) $2,500 underapplied.

Question

Paul Company used a predetermined overhead rate during the year just completed of $3.50 per direct labour hour,based on an estimate of 22,000 direct labour hours to be worked during the year.Actual overhead cost and activity during the year were:  The underapplied or overapplied overhead for the year was:
A) $13,000 underapplied. 
B) $10,500 overapplied. 
C) $2,500 overapplied. 
D) $2,500 underapplied.

Quizplus · Accepted Answer

The Answer of Paul Company used a predetermined overhead rate during the year just completed of $3.50 per direct labour hour,based on an estimate of 22,000 direct labour hours to be worked during the year.Actual overhead cost and activity during the year were:  The underapplied or overapplied overhead for the year was:
A) $13,000 underapplied. 
B) $10,500 overapplied. 
C) $2,500 overapplied. 
D) $2,500 underapplied.

Paul Company Used a Predetermined Overhead Rate During the Year