(Appendix 10A) Arca Incorporated Makes a Single Product--A Critical Part

Multiple Choice

(Appendix 10A) Arca Incorporated makes a single product--a critical part used in commercial airline seats. The company has a standard cost system in which it applies overhead to this product based on the standard machine-hours allowed for the actual output of the period. Data concerning the most recent year appear below:

-The total manufacturing overhead is underapplied or overapplied by how much?

A) $38,462 Underapplied
B) $13,888 Underapplied
C) $38,462 Overapplied
D) $13,888 Overapplied