Manufacturing Overhead Applied on the Basis of Direct Labor-Hours Was

question 93

Multiple Choice

Manufacturing overhead applied on the basis of direct labor-hours was $120,000, while actual manufacturing overhead incurred was $124,000 for the month of April. Which of the following is always true given the statement above?

• A) Overhead was overapplied by $4,000.
• B) Overhead was underapplied by $4,000.
• C) Actual direct labor-hours exceeded budgeted direct labor-hours.
• D) Actual direct labor-hours were less than budgeted direct labor-hours.

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