Reference no: EM13890847

The following data pertain to the Aquarius Hotel Supply Company for the year just ended.

Budgeted sales revenue                                                      $945,000
Budgeted manufacturing overhead                                       650,000
Budgeted machine hours (based on practical capacity)            20,000
Budgeted direct-labor hours (based on practical capacity)       25,000
Budgeted direct-labor rate per hour                                     13
Actual manufacturing overhead                                            690,000
Actual machine hours                                                          22,000
Actual direct-labor hours                                                     26,000
Actual direct-labor rate per hour                                          14

Required:

1. Compute the firm's predetermined overhead rate for the year using each of the following common cost drivers: (a) machine hours, (b) direct-labor hours, and (c) direct-labor dollars.

2. Calculate the overapplied or underapplied overhead for the year using each of the cost drivers listed above.