If actual overhead is greater than applied manufacturing overhead, then manufacturing overhead is: Select one:

a. underapplied.

b. overapplied.

c. a loss on the income statement under "Other Expenses and Losses."

d. considered a miscellaneous expense.

Question

Leonard Mccarthy

Business

14 September, 07:16

If actual overhead is greater than applied manufacturing overhead, then manufacturing overhead is: Select one:

a. underapplied.

b. overapplied.

c. a loss on the income statement under "Other Expenses and Losses."

d. considered a miscellaneous expense.

+4

Answers (1)

Know the Answer?

Jadiel · Answer 1

a. under applied.

Explanation:

For computing, whether it is under applied or over applied first, we have to compute the predetermined overhead rate. The formula is shown below:

Predetermined overhead rate = (Total estimated manufacturing overhead) : (estimated direct labor-hours)

Now we have to find the applied overhead which equal to

= Actual direct labor-hours * predetermined overhead rate

So, the ending overhead equals to

= Actual manufacturing overhead - applied overhead

= under-applied

If actual overhead is more than the applied overhead

If actual overhead is greater than applied manufacturing overhead, then manufacturing overhead is: Select one:a. underapplied.b. overapplied.c. a loss on the income statement under "Other Expenses and Losses."d. considered a miscellaneous expense.

If actual overhead is greater than applied manufacturing overhead, then manufacturing overhead is: Select one:

a. underapplied.

b. overapplied.

c. a loss on the income statement under "Other Expenses and Losses."

d. considered a miscellaneous expense.