Drew Company’s predetermined overhead rate for 2022 is $12.00 per direct labor hour. Drew’s actual overhead costs in July 2022 were $1,250,000, and actual direct labor hours were 100,000. Calculate the amount of any overapplied or underapplied overhead in July. (If underapplied, enter your answer as a negative number by typing a minus “–” sign in front of your answer. Do not include a $ sign.)

Drew Company’s predetermined overhead rate for 2022 is $12.00 per direct labor hour. Drew’s actual overhead costs in July 2022 were $1,250,000, and actual direct labor hours were 100,000. Calculate the amount of any overapplied or underapplied overhead in July. (If underapplied, enter your answer as a negative number by typing a minus “–” sign in front of your answer. Do not include a $ sign.)

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 8PA: Coops Stoops estimated its annual overhead to be $85,000 and based its predetermined overhead rate...

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When setting its predetermined overhead application race, Tasty Box Meals estimated its overhead would be $100,000 and would require 25,000 machine hours in the next year. At the end of the year. It found that actual overhead was $102,000 and required 26,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under applied or over applied overhead.
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