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Match Point, Inc. has the following overhead standards:
Variable overhead: 4 hours at $8 per hour
Fixed overhead: 4 hours at $10 per hour
The standards were based on a planned activity of 20,000 machine hours when 5,000 units were scheduled for production. Actual data follow.
Variable overhead incurred: $167,750
Fixed overhead incurred: $210,000
Machine hours worked: 19,800
Actual units produced: 5,100

-The amount of variable overhead that Match Point applied to production is:
A) $158,400.
B) $160,000.
C) $163,200.
D) $167,750.
E) None of the answers is correct.

Question

Use the following information to answer Questions 
Match Point, Inc. has the following overhead standards:
Variable overhead: 4 hours at $8 per hour
Fixed overhead: 4 hours at $10 per hour
The standards were based on a planned activity of 20,000 machine hours when 5,000 units were scheduled for production. Actual data follow.
Variable overhead incurred: $167,750
Fixed overhead incurred: $210,000
Machine hours worked: 19,800
Actual units produced: 5,100

-The amount of variable overhead that Match Point applied to production is:
A) $158,400.
B) $160,000.
C) $163,200.
D) $167,750.
E) None of the answers is correct.

Quizplus · Accepted Answer

The amount of variable overhead applied to production is calculated based on the standard cost times the actual activity. The standard variable overhead rate is $8 per hour, and the actual machine hours worked were 19,800. Therefore, the applied variable overhead is 19,800 hours * $8/hour = $158,400. However, since none of the provided choices matches this calculation and the question specifically asks for the amount applied (not incurred), it seems there might be a misunderstanding in the calculation or the interpretation of the question. Given the provided choices and the standard calculation method, none of the answers match the correct calculation based on the given data. However, if we consider the standard hours for the actual production (5,100 units * 4 hours/unit = 20,400 standard hours) and apply the variable overhead rate ($8 per hour), we get 20,400 * $8 = $163,200, which matches choice C, assuming the calculation is based on standard hours for actual production rather than actual hours worked.

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