Answer:
Under allocation= 1,000 underallocated
Explanation:
Giving the following information:
Dukes Corporation used a predetermined overhead rate this year of $2 per direct labor-hour, based on an estimate of 20,000 direct labor-hours to be worked during the year. Actual costs and activity during the year were: Actual manufacturing overhead cost incurred $ 38,000 Actual direct labor-hours worked 18,500
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 2*18,500= $37,000
Real overhead= 38,000
Over/under allocation= real MOH - allocated MOH
Under allocation= 38,000 - 37,000= 1,000 underallocated
