Fresco Production uses a predetermined overhead rate based upon direct labour hours. The firm has the following budgeted and actual data for the current year:
$$\begin{array} { l r }
\text { Budgeted factory overhead cost } & \$ 12000 \
\text { Actual factory overhead cost } & \$ 13500 \
\text { Budgeted direct labour hours } & 2000 \
\text { Actual direct labour hours } & 2400
\end{array}$$
What was the amount of underapplied or overapplied overhead for the year?

Question

Fresco Production uses a predetermined overhead rate based upon direct labour hours. The firm has the following budgeted and actual data for the current year:
$$\begin{array} { l r } 
\text { Budgeted factory overhead cost } & \$ 12000 \
\text { Actual factory overhead cost } & \$ 13500 \
\text { Budgeted direct labour hours } & 2000 \
\text { Actual direct labour hours } & 2400
\end{array}$$
What was the amount of underapplied or overapplied overhead for the year?

Quizplus · Accepted Answer

The Answer of Fresco Production uses a predetermined overhead rate based upon direct labour hours. The firm has the following budgeted and actual data for the current year:
$$\begin{array} { l r } 
\text { Budgeted factory overhead cost } & \$ 12000 \
\text { Actual factory overhead cost } & \$ 13500 \
\text { Budgeted direct labour hours } & 2000 \
\text { Actual direct labour hours } & 2400
\end{array}$$
What was the amount of underapplied or overapplied overhead for the year?

Fresco Production Uses a Predetermined Overhead Rate Based Upon Direct