Morris company applies overhead based on direct labor costs. for the current year, morris company estimated total overhead costs to be $400,000, and direct labor costs to be $2,000,000. actual overhead costs for the year totaled $380,000, and actual direct labor costs totaled $1,800,000. at year-end, the balance in the factory overhead account is a:

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Business

Terrance Hansen

10 September, 23:04

Morris company applies overhead based on direct labor costs. for the current year, morris company estimated total overhead costs to be $400,000, and direct labor costs to be $2,000,000. actual overhead costs for the year totaled $380,000, and actual direct labor costs totaled $1,800,000. at year-end, the balance in the factory overhead account is a:

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Brian Joseph · Answer 1

The year-end balance in the factory overhead account was $20,000, because only $380,000 of the anticipated $400,000 was used during the year. The direct labor costs also came in under budget, with a $200,000 difference between anticipated and actual spending.