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Keowee Enterprises began the year with $165,700 of finished goods inventory. During the year the company manufactured goods costing $689,200. At the end of the year, $194,100 of finished goods remained in inventory. Actual manufacturing overhead was $235,800, estimated manufacturing overhead was $230,000, and manufacturing overhead applied totaled $221,500.
-The amount of over- underapplied manufacturing overhead was:
A)$ 5,800 underapplied
B)$14,300 underapplied
C)$ 8,500 overapplied
D)$ 2,700 overapplied

Question

Quizplus · Accepted Answer

To calculate the amount of over- or underapplied manufacturing overhead, we need to subtract the amount of manufacturing overhead applied from the actual manufacturing overhead.

Actual manufacturing overhead = $235,800
Manufacturing overhead applied = $221,500

$235,800 - $221,500 = $14,300 underapplied

Therefore, the correct answer is B) $14,300 underapplied.

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