The predetermined overhead rate is $50 per machine-hour, under-applied overhead is $5,000, and the actual amount of machine-hours is 2,000. What is the actual amount of total manufacturing overhead incurred during the period?

Solution:

Actual machine hours = 2,000 machine hours

Per-determined overhead rate = $50 per machine hour

Applied manufacturing overhead = Actual machine hour multiply with Predetermined overhead rate

= $50 multiply with 2,000 machine hours = $100,000

Underapplied overhead = $5,000

Thus, in order to calculate manufacturing overhead cost that has been incurred, the following costs will be added

Actual manufacturing overhead incurred = Applied manufacturing overhead + Underapplied overhead = $100,000 + $5,000 = $105,000

Hence, Answer is A.$105,000