Chipata Corporation Applies Manufacturing Overhead to Jobs on the Basis

Multiple Choice

Chipata Corporation applies manufacturing overhead to jobs on the basis of machine-hours. Chipata estimated 25,000 machine-hours and $10,000 of manufacturing overhead cost for the year. During the year, Chipata incurred 26,200 machine-hours and $11,300 of manufacturing overhead. What was Chipata's underapplied or overapplied overhead for the year?

A) $480 overapplied
B) $820 underapplied
C) $1,300 overapplied
D) $1,300 underapplied