Morgan Company Uses a Job Costing System

question 307

Multiple Choice

Morgan Company uses a job costing system. Morgan Company estimated manufacturing overhead costs for the year at $330,800, based on 60,200 estimated direct labor hours. Actual direct labor hours for the year totaled 75,800. Actual manufacturing overhead for the year was $385,200. By how much was manufacturing overhead overallocated or underallocated for the year? (Round intermediary calculations to the nearest cent.)

• A)$31,700 overallocated
• B)$31,700 underallocated
• C)$54,400 overallocated
• D)$54,400 underallocated

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Definitions:

Amino Acids

Organic compounds that combine to form proteins and are used by the body for various functions including tissue repair and the synthesis of neurotransmitters.

Fatty Acids

Organic compounds made of long hydrocarbon chains ending in a carboxylic acid group, essential in diet and biology for energy storage and cell membrane structure.

Peptide

Short chain of amino acids linked by peptide bonds.