Lonestar Corporation Uses a Job-Order Costing System to Account for Product

question 72

Multiple Choice

Lonestar Corporation uses a job-order costing system to account for product costs. The following information pertains to 2014: Factory overhead rate is $18 per direct labor hour.
What is the amount of under- or overapplied overhead for Lonestar Corporation in 2014?

• A) $40,000 overapplied
• B) $20,000 overapplied
• C) $40,000 underapplied
• D) $20,000 underapplied

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