Question

Acton Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations. Estimated manufacturing overhead $361,260 Estimated machine-hours 2,700 Actual manufacturing overhead $354,700 Actual machine-hours 2,660 The estimates of the manufacturing overhead and of machine-hours were made at the beginning of the year for the purpose of computing the company's predetermined overhead rate for the year. The overhead for the year was: Noreen 4e Recheck 2017-16-03

$5,352 underapplied

$5,352 overapplied

$1,208 underapplied

$1,208 overapplied

Answer 1

Correct Answer $1208 Overapplied

Calculations
A	Estimated Manufacturing Overheads	$ 361,260.00
B	Estimated Machine Hours	2700
C=A/B	Predetermined Overheads	$          133.80
D	Actual Machine Hours	2660
E=C*D	Applied Overheads	$ 355,908.00
F	Actual Manufacturing Overheads	$ 354,700.00
G=E-F	Over applied Manufacturing Overheads	$      1,208.00

When Manufacturing overheads applied are more than Actual Overheads Incurred then it is called to be Over applied.