Biltz Company Uses a Predetermined Overhead Rate Based on Direct

question 314

Multiple Choice

Biltz Company uses a predetermined overhead rate based on direct labor hours to allocate manufacturing overhead to jobs.During the year,the company actually incurred manufacturing overhead costs of $582,000 and 135,000 direct labor hours were worked.The company estimated that it would incur $525,000 of manufacturing overhead during the year and that 150,000 direct labor hours would be worked.
By how much was manufacturing overhead overallocated or underallocated for the year?

• A)$57,000 overallocated
• B)$57,000 undererallocated
• C)$109,500 underallocated
• D)$109,500 overallocated

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