The Thomlin Company Forecasts That Total Overhead for the Current

Multiple Choice

The Thomlin Company forecasts that total overhead for the current year will be $15,000,000 and that total machine hours will be 300,000 hours. Year to date, the actual overhead is $16,000,000 and the actual machine hours are 330,000 hours. If the Thomlin Company uses a predetermined overhead rate based on machine hours for applying overhead, as of this point in time (year to date) the overhead is over/under applied by

A) $1,000,000 overapplied
B) $1,000,000 underapplied
C) $500,000 overapplied
D) $500,000 underapplied