Hartford, Inc., produces automobile bumpers. Overhead is applied on the basis of machine hours required for cutting and fabricatiing. A predetermined overhad application rate of $12.70 per machine hour was established for 2007
Manufacturing overhead--over/underapplied.
Hartford, Inc., produces automobile bumpers. Overhead is applied on the basis of machine hours required for cutting and fabricatiing. A predetermined overhad application rate of $12.70 per machine hour was established for 2007
Required:
a) If 9,000 machine hours were expected to be used during 2007, how much overhead was expected to be incurred?
b) Actual overhead incurred during 2007 totaled $121,650, and 9,100 machine hours were used during 2007. Calculate the amount of over- or underapplied overhead for 2007
c) Explain the accounting necessary for the over- or underapplied overhead for the next year.
