Brace Corporation Uses Direct Labor-Hours in Its Predetermined Overhead Rate

question 53

Multiple Choice

Brace Corporation uses direct labor-hours in its predetermined overhead rate.At the beginning of the year,the estimated direct labor-hours were 21,600 hours.At the end of the year,actual direct labor-hours for the year were 20,400 hours,the actual manufacturing overhead for the year was $506,920,and manufacturing overhead for the year was underapplied by $23,440.The estimated manufacturing overhead at the beginning of the year used in the predetermined overhead rate must have been:

• A)$501,920
• B)$531,445
• C)$483,480
• D)$511,920

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Definitions:

API GL-5

A classification of lubricants, defined by the American Petroleum Institute, indicating oil suitability for high-pressure conditions in vehicle axles and transmissions.

Zerk Fitting

A standard grease nipple. Its orifice is sealed with a spring-loaded ball that unseats when pressurized grease is applied to it.

Grease Nipple

A fitting used on mechanical systems to feed lubricants under pressure into bearings, joints, or mechanical systems.

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Various chemical formulations used to lower the freezing point and raise the boiling point of the coolant in engines.