Company, Inc

question 167

Multiple Choice

Company, Inc. applies overhead on the basis of direct labour hours. At the beginning of the year, Company, Inc. estimates overhead to be $540,000, machine hours to be 150,000, and direct labour hours to be 90,000. During January, Company, Inc. has 8,000 direct labour hours and 12,000 machine hours.
-Refer to the Figure.Suppose the actual overhead for January is $51,000.What is the overhead variance?

• A)$800 overapplied
• B)$800 underapplied
• C)$3,000 overapplied
• D)$3,000 underapplied

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