Question

During March 2019, Roberts Corporation recorded $254,000 of costs related to factory overhead. Alaska's overhead application rate is based on direct labor hours. The preset formula for overhead application estimated that $250,000 would be incurred, and 12,500 direct labor hours would be worked. During March, 12,800 hours were actually worked. Use this information to determine the amount of overhead over or under applied. Enter overapplied overhead as a negative number. (round & enter any final dollar answers to the nearest whole dollar)

Answer 1

Particulars	$
Estimated overhead	$      250,000
Estimated direct labor hours	12500
Estimated overhead rate per hour	$                20
Actual hours	12800
Overhead should have applied	$      256,000
Actual overhead applied	$      254,000
Overhead Underapplied	$           2,000

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