Randall Company Manufactures Products to Customer Specifications The Amount of Underapplied or Overapplied Overhead Is:
A)$60,000 Overapplied

question 15

Multiple Choice

Randall Company manufactures products to customer specifications. A job costing system is used to accumulate production costs. Factory overhead cost was applied at 125% of direct labor cost. Selected data concerning the past year's operation of the company are presented below. $\begin{array}{lrrr} & \text { January 1 } & \text { December 31 } \\\text { Direct materials } & \$ 77,000 & \$ 40,000 \\\text { Work in process } & 66,000 & 42,000 \\\text { Finished goods } & 115,000 & 100,000\\\text { Other information }\\\text { Direct materials purchases } && \$ 324,000 \\\text { Cost of goods available for sale } && 950,000 \\\text { Actual factory overhead costs } && 260,000\end{array}$ The amount of underapplied or overapplied overhead is:

• A)$60,000 overapplied.
• B)$60,000 underapplied.
• C)$10,000 overapplied.
• D)$10,000 underapplied.
• E)$0.

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