Terrence Industries charges manufacturing overhead to products by using a predetermined application rate, computed on the basis of labor hours. The following data pertain to the current year: Budgeted manufacturing overhead$1,800,000 Actual manufacturing overhead 1,810,000 Budgeted labor hours 60,000 Actual labor hours 61,500 Which of the following choices is the correct status of manufacturing overhead at year-end?
A. Overapplied by $45,000.
B. Underapplied by $35,000.
C. Overapplied by $35,000.
D. Overapplied by $10,000.
E. Underapplied by $10,000.
Answer: C
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