Bonehead Co The Total Underapplied or Overapplied Factory Overhead for Bonehead Co

question 93

Multiple Choice

Bonehead Co. has the following factory overhead costs for the most recent period: $\begin{array}{lr}\text { Standard overhead cost applied to this period's production } & \$ 72,000 \\\text { Flexible budget for overhead based on output (i.e., units produced) } & 65,000 \\\text { Total budgeted overhead in the master (static) budget } & 86,000 \\\text { Actual total overhead cost incurred during the period } & 76,000\end{array}$ The total underapplied or overapplied factory overhead for Bonehead Co. for the period, to the nearest whole number, is:

• A) $4,000 underapplied.
• B) $7,000 overapplied.
• C) $10,000 overapplied.
• D) $11,000 underapplied.
• E) $14,000 underapplied.

---

Definitions:

Rational Consumer

A theoretical concept depicting a consumer who makes decisions based on maximizing utility, considering all available information and options.

Utility Levels

A measure of the varying degrees of satisfaction or utility that consumers derive from different bundles of goods and services.

Preferences

The tastes, desires, or choices that consumers have regarding products, goods, or services.

Indifference Curves

Graphical representations used in economics to show different combinations of goods or services between which a consumer is indifferent.