During the Year,Paul Company Used a Predetermined Overhead Rate of $3.50

question 8

Multiple Choice

During the year,Paul Company used a predetermined overhead rate of $3.50 per direct labour hour,based on an estimate of 22,000 direct labour hours to be worked during the year.Actual overhead cost and activity during the year were:
What was the under- or overapplied overhead for the year?

• A) $2,500 overapplied.
• B) $2,500 underapplied.
• C) $10,500 overapplied.
• D) $13,000 underapplieD. $90,000 - (25,000 @ $3.50)= $2,500 underapplieD.

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Definitions:

Consequential Damages

Losses that do not flow directly and immediately from an act but only from some of the consequences or results of the act.

Polished

Describes something that has been refined, improved, or made smooth and shiny, often through thorough work or effort.

Satisfactory Performance

The achievement of work or tasks to a level that meets agreed standards or expectations.

Good Faith

A principle of honesty, fairness, and sincerity in dealings, devoid of intent to defraud or seek unfair advantage.