4. Alma Corporation has developed the following budget formula for annual indirect labor costs: Total cost 180,000+4.5 per machine hour Operating budgets for the current month are based upon 20,000 machine hours of planned machine time. Indirect cost included in this monthly planning budget are: a. 90,000 b. 105,000 c. 180,000 d. 270,000

Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter19: Support Department And Joint Cost Allocation
Section: Chapter Questions
Problem 2CMA: Adam Corporation manufactures computer tables and has the following budgeted indirect manufacturing...
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Answer numbers 4-6.
4. Alma Corporation has developed the following budget formula for annual indirect labor costs:
Total cost 180,000+4.5 per machine hour
Operating budgets for the current month are based upon 20,000 machine hours of planned machine
time. Indirect cost included in this monthly planning budget are:
a. 90,000
b. 105,000
c. 180,000
d. 270,000
5. What is the total fixed cost of the shopping department of Emba-Mall clothing Co. if it has the
following information for 2014?
Salaries
Packaging
800,000 of employees on guaranteed contracts
400,000 depending on size of item(s) shipped
500,000 depending on weight of item(s) shipped
Rent of warehouse space 250,000 annual lease
a. 850,000
Postage
b. 900,000
c. 1,050,000
d. 1,950,000
Transcribed Image Text:4. Alma Corporation has developed the following budget formula for annual indirect labor costs: Total cost 180,000+4.5 per machine hour Operating budgets for the current month are based upon 20,000 machine hours of planned machine time. Indirect cost included in this monthly planning budget are: a. 90,000 b. 105,000 c. 180,000 d. 270,000 5. What is the total fixed cost of the shopping department of Emba-Mall clothing Co. if it has the following information for 2014? Salaries Packaging 800,000 of employees on guaranteed contracts 400,000 depending on size of item(s) shipped 500,000 depending on weight of item(s) shipped Rent of warehouse space 250,000 annual lease a. 850,000 Postage b. 900,000 c. 1,050,000 d. 1,950,000
6. Harem Company uses an annual cost formula for overhead of P72,000 + P1.60 for each direct labor
hour worked. For the upcoming month Karla plans to manufacture 96,000 units. Each unit requires
five minutes of direct labor. Harem Company's budgeted overhead for the month is
a. P 12,800
b. P 18,800
c. P 84,800
d. P774,000
Transcribed Image Text:6. Harem Company uses an annual cost formula for overhead of P72,000 + P1.60 for each direct labor hour worked. For the upcoming month Karla plans to manufacture 96,000 units. Each unit requires five minutes of direct labor. Harem Company's budgeted overhead for the month is a. P 12,800 b. P 18,800 c. P 84,800 d. P774,000
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