The Following Information Was Gathered for All the Products Made

question 22

Multiple Choice

The following information was gathered for all the products made by the Ringaling Company:
$\begin{array}{ll}\text { Budgeted direct labor hours } & 31,000 \\\text { Actual direct labor hours } & 32,400\\\text { Budgeted factory overhead costs }&\$147,250\\\text { Actual factory overhead costs }&\$149,980\end{array}$
Assume the cost driver for factory overhead costs is direct labor hours.What is the amount of overapplied or underapplied overhead?

• A) $2,730 underapplied
• B) $2,730 overapplied
• C) $3,920 underapplied
• D) $3,920 overapplied

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Definitions:

Intrastate Agreements

Agreements or contracts that occur within the same state, subject to the state's laws and not impacting interstate commerce.

Chicago School

An economic viewpoint emphasizing free-market principles and the reduction of government involvement in the economy, especially noted for its influence in antitrust law.

Antitrust Enforcement

The regulation and enforcement of laws to promote competition and prevent monopolies and other practices that restrain trade.

Economic Efficiency

A situation where resources are allocated in such a way that maximizes the production of goods and services, minimizing waste and inefficiency in an economy.