The Dewey Company uses a predetermined overhead rate to apply manufacturing overhead to production. The rate is based on direct labour hours. Estimates for the year just ended are as follows:
During the year Dewey Company used 37,000 direct labour hours.
At the end of the year, Dewey Company records revealed the following information:
Required:
a.
Calculate the predetermined overhead rate for the year.
b.
Determine the amount of overhead applied during the year.
c.
Determine the amount of underapplied or overapplied manufacturing overhead for the year.
Definitions:
Hypothesis Testing
A statistical method that is used in making statistical decisions using experimental data.
Specific Hypotheses
Precise, testable predictions derived from a broader theory that specify the expected relationship between variables.
Cognitive Dissonance
A psychological state in which an individual experiences discomfort due to holding contradictory beliefs or attitudes, often leading to an alteration in one of the conflicting cognitions.
Mid-Level
Pertains to a position, status, or area that is in between the highest and the lowest levels, often implying a moderate degree of complexity or authority.
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