Figure 4-1 The Foremost Company Predicted Factory Overhead for 2016 and 2017

question 33

Multiple Choice

Figure 4-1
The Foremost Company predicted factory overhead for 2016 and 2017 would be $120,000 for each year. The predicted activity for 2016 and 2017 were 30,000 and 20,000 direct labor hours, respectively. Additional data are as follows:
The company assumes that the long-run normal production level is 20,000 direct labor hours per year. The actual factory overhead cost for the end of 2016 and 2017 was $120,000. Assume that it takes one direct labor hour to make one finished unit.
-Refer to Figure 4-2. If normal costing is used, the amount of overhead applied for the year is

• A) $414,000.
• B) $400,000.
• C) $480,000.
• D) $460,000.

---

Definitions:

Information

Data, knowledge, or details that are provided or learned about something or someone.

Culture

The collective beliefs, practices, traditions, art, history, folklore, and societal structures belonging to a community of individuals.

Business

The practice of engaging in commercial, industrial, or professional activities with the aim of generating revenue and profit.

Genocide

The deliberate and systematic extermination of a national, racial, political, or cultural group.