Reference no: EM132727133
Aidan, Ltd. is a manufacturer that uses a job order costing system. It uses a single, plantwide predetermined overhead rate, and applies overhead at a rate of 80% of direct labor dollars. During the period, the firm started and completed several jobs.
The following information was obtained related to costs incurred during the period:
Direct materials used: $145,000
Indirect materials used: $15,000
Direct labor used: $110,000
Indirect labor used: $25,000
Actual other factory overhead costs: $46,900
Problem 1: Calculate the amount of under- or overapplied overhead:
a.$1,100 overapplied.
b.$6,900 overapplied.
c.$6,900 underapplied.
d.$46,900 underapplied.
e.$1,100 underapplied.