Jackson Inc If Overhead Is Applied Based on Direct Labor Hours, Overapplied/underapplied

question 9

Multiple Choice

Jackson Inc. listed the following data for 2019: $\begin{array}{lr}\text { Budgeted factory overhead } & \$ 1,271,000 \\\text { Budgeted direct labor hours } & 82,000 \\\text { Budgeted machine hours } & 41,000 \\\text { Actual factory overhead } & 1,201,000 \\\text { Actual direct labor hours } & 86,300 \\\text { Actual machine hours } & 39,400\end{array}$ If overhead is applied based on direct labor hours, overapplied/underapplied overhead is:

• A)$136,650 overapplied.
• B)$136,650 underapplied.
• C)$174,775 underapplied.
• D)$174,775 overapplied.
• E)$-0-.

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Definitions:

Hydraulic Fracturing

The use of high-pressure fluids and sand to open up fractures in limited-permeability reservoir rocks in order to extract oil and gas.

Shale Gas

Natural gas that is found trapped within shale formations, which are fine-grained sedimentary rocks.

Directional Drilling

Drilling within a targeted shale body to permit hydraulic fracturing.

Maturation Of Coal

The process through which plant material is converted into coal over millions of years, increasing in carbon content and energy.