Blackfoot Softball Glove Company Estimated the Following Yearly Data at the Beginning

question 32

Multiple Choice

Blackfoot Softball Glove Company estimated the following yearly data at the beginning of the year:
Blackfoot uses departmental overhead rates. In the assembly department, direct labour hours are used to apply overhead. Machine hours are used to apply overhead in the testing department.
Actual data for August are as follows:
$$\begin{array} { l r r r } & \text { Assembly Department } & \text { Testing Department } & \text { Total } \\\text { Overhead } & \$ 570,000 & \$ 130,000 & \$ 700,000 \\\text { Direct Labour Hours } & 142,500 & 32,500 & 175,000 \\\text { Machine Hours } & 32,000 & 65,000 & 97,000\end{array}$$ $\begin{array}{rrrr} & \text { Assembly Department } & \text { Testing Department } & \text { Total } \\\text { Overhead } & \$ 42,000 & \$ 12,000 & \$ 54,000\\\text { Direct Labour Hours } & 13,500 & 2,430 & 15,930 \\\text { Machine Hours } & 4,020 & 11,000 & 15,020\end{array}$
-Refer to the Figure.Which of the following best represents the departmental overhead rates?

• A)Applied overhead for the testing department is $4,860.
• B)Applied overhead for the assembly department is $54,000.
• C)Applied overhead for both departments combined is $63,720.
• D)Overhead for the assembly department is underapplied.