Kimble Company Applies Overhead on the Basis of Machine Hours

question 147

Multiple Choice

Kimble Company applies overhead on the basis of machine hours.Given the following data, compute overhead applied and the under- or overapplication of overhead for the period: $$\begin{array} { l r } \text { Estimated annual overhead cost } & \$ 1,600,000 \\\text { Actual annual overhead cost } & \$ 1,540,000 \\\text { Estimated machine hours } & 400,000 \\\text { Actual machine hours } & 380,000\end{array}$$

• A)$1,520,000 applied and $20,000 overapplied
• B)$1,600,000 applied and $20,000 overapplied
• C)$1,520,000 applied and $20,000 underapplied
• D)$1,463,000 applied and neither under- nor overapplied