Product Costing-Manufacturing Overhead- over/underapplied LampArt Co. makes specialty table lamps. Manufacturing
overhead is applied to production on a direct labor hours basis. During
November, the first month of the company’s fiscal year, $173,250 of
manufacturing overhead was applied to work in process inventory using the
predetermined overhead application rate of $15 per direct labor hour.A) Calculate
the number of hours of direct labor used during November.B) Actual
manufacturing overhead costs incurred during November totaled $166,425.
Calculate the amount over or under applied for November.C) Identify
two possible explanations for the over or under applied overhead.
D) Explain
the accounting appropriate for the over or under applied overhead at the end of
November.