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# Department 40

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The estimated total factory overhead cost and total machine hours for Department 40 for the current year are \$225,000 and 56,250 respectively. During January, the first month of the current year, actual machine hours used totaled 5,100 and factory overhead cost incurred totaled \$19,800.

(a) Determine the factory overhead rate based on machine hours.

(b) Present the entry to apply factory overhead to production in Department 40 for January.

(c) What is the balance of Factory Overhead - Department 40 at January 31?

(d) Does the balance of Factory Overhead - Department 40 at January 31 represent overapplied or underapplied factory overhead?

#### Solution Preview

The estimated total factory overhead cost and total machine hours for Department 40 for the current year are \$225,000 and 56,250 respectively. During January, the first month of the current year, actual machine hours used totaled 5,100 and factory overhead cost incurred totaled \$19,800.

(a) Determine the factory ...

#### Solution Summary

This solution is comprised of a detailed explanation and calculation to determine the factory overhead rate based on machine hours, present the entry to apply factory overhead to production in Department 40 for January, find the balance of Factory Overhead, and find overapplied or underapplied of the Factory Overhead.

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