Midwest Corporation Has Provided the Following Data Concerning Manufacturing Overhead

question 140

Multiple Choice

Midwest Corporation has provided the following data concerning manufacturing overhead for 2020:
$\begin{array}{lrr} \text {Estimated manufacturing overhead for the year } &\$30,000\\ \text { Estimated direct labor hours for the year } &2,000\\\end{array}$

Two jobs were worked on during the year: Job A-101 and Job A-102. The number of direct labor-hours spent on Job A-101 and Job A-102 were 1,200 and 1,000, respectively. The actual manufacturing overhead was $37,000.
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What is the amount of the under- or overapplied manufacturing overhead?

• A) $1,000 underapplied.
• B) $3,000 overapplied.
• C) $4,000 underapplied.
• D) $7,000 overapplied.

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Definitions:

Customer Relationship Era

A business approach focusing on building long-term relationships with customers to enhance loyalty and lifetime value.

Market Orientation

A business approach where the needs and wants of customers guide all marketing decisions and strategies.

Customer Value

Refers to the perceived worth of a product or service in the eyes of the customer, balancing its benefits against its cost.

Product Orientation

A business philosophy that focuses on the quality and attributes of the product itself rather than customer needs or desires.