Parker Corporation Has a Job-Order Costing System and Uses a Predetermined

question 174

Multiple Choice

Parker Corporation has a job-order costing system and uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. At the beginning of the year, manufacturing overhead and direct labor-hours for the year were estimated at $50,000 and 20,000 hours, respectively. In June, Job #461 was completed. Materials costs on the job totaled $4,000 and labor costs totaled $1,500 at $5 per hour. At the end of the year it was determined that the company worked 24,000 direct labor-hours for the year and incurred $54,000 in actual manufacturing overhead costs.The manufacturing overhead for the year was:

• A) $6,000 overapplied
• B) $10,000 overapplied
• C) $10,000 underapplied
• D) $4,000 underapplied

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Definitions:

Concussion

A type of traumatic brain injury caused by a blow to the head or body, a fall, or another injury that jars or shakes the brain inside the skull.

Temporal Bone

A bone of the skull, located at the sides and base of the skull, and housing the structures of the ears.

Tarsal Bone

One of seven ankle bones.

Articulates

Relates to the manner in which joints connect between bones, allowing for movement and support in the skeletal system.