Cabrini Company Produces Two Products: Toy Trucks and Toy Cars

Multiple Choice

Cabrini Company produces two products: toy trucks and toy cars. The company uses departmental overhead rates for the two production departments: Moulding and Finishing. Moulding uses machine hours to assign overhead and Finishing uses direct labour hours; 50,000 trucks and 250,000 cars are produced. Please find the following data:
$\begin{array}{|l|c|c|c|}\hline & \text { Moulding } & \text { Finishing } & \text { Total } \\\hline \text { Estimated overhead } & \$ 250,000 & \$ 100,000 & \$ 350,000 \\\hline \text { Actual overhead } & \$ 240,000 & \$ 120,000 & \$ 360,000 \\\hline & & & \\\hline \text { Expected direct labour hours } & & & \\\hline \text { Trucks } & 5,000 & 5,000 & 10,000 \\\hline \text { Cars } & 5,000 & 35,000 & 40,000 \\\hline \text { Expected machine hours } & & & \\\hline \text { Trucks } & 17,000 & 3,000 & 20,000 \\\hline \text { Cars } & 3,000 & 7,000 & 10,000 \\\hline \text { Actual direct labour hours } & & & \\\hline \text { Trucks } & 4,500 & 5,300 & 10,000 \\\hline \text { Cars } & 5,500 & 34,500 & 40,000 \\\hline \text { Actual machine hours } & & & \\\hline \text { Trucks } & 16,500 & 3,500 & 20,000 \\\hline \text { Cars } & 3,200 & 6,800 & 10,000 \\\hline\end{array}$
-Refer to the figure.How much was overhead overapplied or underapplied?

A) $4,250
B) $10,000
C) $14,250
D) $20,000