Tork Corporation applies manufacturing overhead costs by establishing a predetermined overhead rate linked to direct labor hours. At year-end, the entire over- or under applied overhead is treated as an adjustment to the unadjusted cost of goods sold. Use the following information to calculate the total manufacturing overhead cost that had been estimated before the year had begun:
Actual Manufacturing Overhead Incurred During The Year : $171,000
Total Amount of Direct Labor Hours :
Estimated Before Year Began : 37,500
Actual Hours Worked During The Year : 41,000
Cost of Goods Sold :
Adjusted : $695,000
Unadjusted : $688,000
A) 150,000 B) 157,000 C) 164,000 D) 178,000 E) None
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