Discussion:
Under/overallocated overhead
The T-account showing the manufacturing overhead activity for Jackson, Corp., for 2012 is as follows:
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Manufacturing overhead
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197,000
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207,000
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Requirements
1. What is the actual manufacturing overhead?
2. What is the allocated manufacturing overhead?
3. What is the predetermined manufacturing overhead rate as a percentage of direct labor cost, if actual direct labor costs were $165,600?
4. Is manufacturing overhead underallocated or overallocated? By how much?
5. Is Cost of goods sold too high or too low?