Reference no: EM133031763

Question - Noah Corp. estimates factory overhead to be P800,000 for the coming year. It was also estimated that the company would incur material cost of P1,200,000. It will also estimated to incur P600,000 for direct labor at 20,000 direct labor hours. The company estimates that they will use 40,000 machine hours.

Actual cost for the year are as follows:

Materials - P1,000,000

Direct labor cost at 30,000

Direct labor hours consumed - P750,000

Machine hours - 30,000 hours

Required -

1. If the company uses as its base for overhead is machine hours, how much is the overhead rate?

a. P50 b. P40 c. P26.67 d. P20

2. If the company uses machine hours as basis for estimating overhead, by how much is overhead over or under applied?

A. (P200,000) b. P100 c. P200,000 d.(P100)

3. If the company uses as its base for overhead is direct labor cost, and actual overhead incurred was P1,250,000, by how much is it over or (under) applied?

A. (P250,000) B. P1,000,000 C. (P1,000,000) D. P250,000

4. If the company uses as its base for overhead is direct labor hours, how much is their applied overhead for the year?

A. P1,200,000 B. P20 C. P800,000 D. P40

5. If the company uses as its base for overhead is material cost, how much is the overhead rate?

A. 0.70 B. 0.83 C. 0.80 D. 0.67

6. Using answer in number 22, if actual overhead was P1,150,000 by how much is overhead over or (under) applied?

A. (350,000) B. P350,000 C. P50,000 D. (P50,000)