Exhibit 16-2 Dietrich Company has the following data for August:

- Refer to Exhibit 16-2. Given the information above, if manufacturing overhead is applied at the rate of 80% of direct labor cost, overhead for August is:

Question

Exhibit 16-2 Dietrich Company has the following data for August:

- Refer to Exhibit 16-2. Given the information above, if manufacturing overhead is applied at the rate of 80% of direct labor cost, overhead for August is:

Quizplus · Accepted Answer

To determine if overhead is overapplied or underapplied, compare the applied overhead (80% of direct labor cost) to the actual overhead incurred. If the applied overhead is less than the actual overhead, it is underapplied. The problem states that overhead for August is $1,000 underapplied, indicating that the applied overhead was less than the actual overhead by $1,000.

Exhibit 16-2 Dietrich Company Has the Following Data for August