Apply overhead to jobs using direct labor cost

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Question: XYZ Company applies overhead to jobs using direct labor cost as an activity. For the month of September, XYZ Company estimated it would use $13,600 of direct labor and incur $17,000 of manufacturing overhead cost. The actual results reported by XYZ Company for September included $11,500 in manufacturing overhead cost and $12,000 of direct labor. For the month of September, overhead was:

overapplied by $5,500

overapplied by $3,500

overapplied by $1,900

underapplied by $5,500

underapplied by $3,500

underapplied by $1,900

Reference no: EM131765970

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