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    Cribb Corporation: Over and under applied overhead using a pre-determined overhead rate

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    28. Cribb Corporation uses direct labor-hours in its predetermined rate. At the beginning of the year, the estimated direct labor-hours were 17,900 hours and the total estimated manufacturing overhead was $341,890. At the end of the year, actual direct labor-hours for the year were 16,700 hours and the actual manufacturing overhead for the year was $336,890. Overhead at the end of the year was:
    A) $22,920 underapplied.
    B) $17,920 overapplied.
    C) $17,920 underapplied.
    D) $22,920 overapplied.

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    Solution Preview

    Predetermined overhead rate = 341890/17900= $19.1

    Budgeted ...

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