Shannon Company, a labor-intensive manufacturer, compiled the following data for the current period:
Assuming that Shannon Company uses direct labor cost as a cost driver, determine the amount of overapplied or underapplied overhead for the current period?

Question

Shannon Company, a labor-intensive manufacturer, compiled the following data for the current period:
 Assuming that Shannon Company uses direct labor cost as a cost driver, determine the amount of overapplied or underapplied overhead for the current period?

Quizplus · Accepted Answer

Actual MOH $500,000 - (Applied MOH ($600,000 budgeted MOH/$300,000 budgeted DL cost) x $325,000 actual DL cost) = $150,000 overapplied MOH

Shannon Company, a Labor-Intensive Manufacturer, Compiled the Following Data for the Current