(Solution) - Normal operating capacity of Robertson Inc is 100 000 machine hours -(2025 Original AI-Free Solution)

Paper Details

Normal operating capacity of Robertson Inc. is 100,000 machine hours per month, the level used to compute the predetermined factory overhead application rate. At this level of activity, fixed factory overhead is estimated to be $150,000, and variable factory overhead is estimated to be $250,000. During March, actual production required 105,000 machine hours and actual factory overhead totaled $411,000.
Required:
(1) Determine the fixed portion of the factory overhead application rate.
(2) Determine the variable portion of the factory overhead application rate.
(3) Is factory overhead for March over- or under applied, and by how much?