14 Blerce Corporatlon has two manufacturing departments-Machining and Finishing. The company used the followIng data at thebeglnning of the year to calculate predetermined overhead rates:MachiningFinishing6,000$ 37,800$ 6.00TotalEstimated total machine-hours (MHS)Estimated total fixed manufacturing overhead costEstimated variable manufacturing overhead cost per MH%24244,0007,6001. 2010,000$ 45,400During the most recent month, the company started and completed two Jobs-Job B and Job K. There were no beglnning Inventorles.Data concerning those two Jobs follow:Job BJob K$13,700 $7,900$24,700 $ 6,400Direct materialsDirect labor costMachiningmachine-hoursFinishing machine-hours2,5002,5001,5003,500Requlred:a. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate thatoverhead rate. (Round your answer to 2 decimal places.)b. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate theamount of manufacturing overhead applled to Job B. (Do not round Intermedlate calculations.)C. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. Calculate theamount of manufacturing overhead applled to Job K. (Do not round Intermedlate calculations. Rounc your enswer to the nearestwhole dollar amount.)d. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in bothdepartments. What Is the departmental predetermined overhead rate In the Machining department? (Round your answer to 2 decimalplaces.)e. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in bothproduction departments. What Is the departmental predetermined overhead rate In the Finishing department? (Round your answer to2 declmal places.)f. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base In bothproduction departments. How much manufacturing overhead wll be applled to Job B? (Do not round Intermedlate celculatlons.)g. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in bothproduction departments. How much manufacturing overhead will be appled to Job K?. (Do not round Intermedlate celculatlons.)Predetermined overhead rateper MHa.b.Manufacturing overhead applied Job BC.Manufacturing overhead applied Job Kper MHd.Machining predetermined overhead rateper MHFinishing predetermined overhead ratef.Manufacturing overhead applied job Bg.Manufacturing overhead applied job K

(A). If Company uses Plantwide predefined manufacturing Overhead based on Machine hours, then…

Blerce Corporation has two manufacturing departments-Machining and Finishing. The company used the following data at the beglnning of the year to calculate predetermined overhead rates: Machining 4,000 7,600 1.20 Finishing 6,000 $37,800 $ 6.00 Total Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH 10,000 $ 45,400 %24 24

Blerce Corporation has two manufacturing departments-Machining and Finishing. The company used the following data at the beglnning of the year to calculate predetermined overhead rates: Machining 4,000 7,600 1.20 Finishing 6,000 $37,800 $ 6.00 Total Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH 10,000 $ 45,400 %24 24

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 3CE: Lansing. Inc., provided the following data for its two producing departments: Machine hours are used...

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Queen Bees Honey, Inc., estimated its annual overhead to be $110,000 and based its predetermined overhead rate on 27,500 direct labor hours. At the end of the year, actual overhead was $106,000 and the total direct labor hours were 29,000. What is the entry to dispose of the over applied or under applied overhead?
Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500 machine hours. The cost to make Job 416 is $95 in neon, 15 hours of labor at $13 per hour, and five machine hours. During the month, it incurs $95 in indirect material cost, $130 in administrative labor, $320 in utilities, and $350 in depreciation expense. What is the predetermined overhead rate if machine hours are considered the cost driver? What is the cost of Job 416? What is the overhead incurred during the month?
Coops Stoops estimated its annual overhead to be $85,000 and based its predetermined overhead rate on 24,286 direct labor hours. At the end of the year, actual overhead was $90,000 and the total direct labor hours were 24,100. What is the entry to dispose of the over applied or under applied overhead?
York Company Is a machine shop that estimated overhead will be $50,000, consisting of 5,000 hours of direct labor. The cost to make job 0325 is $70 in aluminum and two hours of labor at $20 per hour. During the month. York incurs $50 in indirect material cost. $150 in administrative labor, $300 in utilities, and $250 in depreciation expense. What is the predetermined overhead rate if direct labor hours are considered the cost driver? What is the cost of Job 0325? What is the overhead incurred during the month?
A company calculated the predetermined overhead based on an estimated overhead of $70.000, and the activity for the cost driver was estimated as 2,500 hours. If product A utilized 1,350 hours and product 8 utilized 1,100 hours, what was the total amount of overhead assigned to the products? A. $35000 B. $30.800 C. $37,800 D. $68,600
The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning February 1 would be 3,150,000, and total direct labor costs would be 1,800,000. During February, the actual direct labor cost totalled 160,000, and factory overhead cost incurred totaled 283,900. a. What is the predetermined factory overhead rate based on direct labor cost? b. Journalize the entry to apply factory overhead to production for February. c. What is the February 28 balance of the account Factory OverheadBlending Department? d. Does the balance in part (c) represent over- or underapplied factory overhead?
Abbey Products Company is studying the results of applying factory overhead to production. The following data have been used: estimated factory overhead, 60,000; estimated materials costs, 50,000; estimated direct labor costs, 60,000; estimated direct labor hours, 10,000; estimated machine hours, 20,000; work in process at the beginning of the month, none. The actual factory overhead incurred for November was 80,000, and the production statistics on November 30 are as follows: Required: 1. Compute the predetermined rate, based on the following: a. Direct labor cost b. Direct labor hours c. Machine hours 2. Using each of the methods, compute the estimated total cost of each job at the end of the month. 3. Determine the under-or overapplied factory overhead, in total, at the end of the month under each of the methods. 4. Which method would you recommend? Why?
SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 543,000 + 1.34X, where X equals number of smokers. Last year, SmokeCity produced 20,000 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year? 4. What is the total variable overhead cost incurred by SmokeCity last year? 5. What is the overhead cost per unit produced? 6. What is the fixed overhead cost per unit? 7. What is the variable overhead cost per unit? 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,500 units and (b) 21,600 units. (Round your answers to the nearest cent.) Explain this outcome.
Comacho Chemical Co. recorded costs for the month of 18,900 for materials, 44,100 for labor, and 26,250 for factory overhead. There was no beginning work in process, 8,000 units were finished, and 3,000 units were in process at the end of the period, two-thirds completed. Compute the months unit cost for each element of manufacturing cost and the total per unit cost. (Round unit costs to three decimal places.)
The books of Petry Products Co. revealed that the following general journal entry had been made at the end of the current accounting period: The total direct materials cost for the period was $40,000. The total direct labor cost, at an average rate of $10 per hour for direct labor, was one and one-half times the direct materials cost. Factory overhead was applied on the basis of $4 per direct labor hour. What was the total actual factory overhead incurred for the period? (Hint: First solve for direct labor cost and then for direct labor hours.)
Baldwin Printing Company uses a job order cost system and applies overhead based on machine hours. A total of 150,000 machine hours have been budgeted for the year. During the year, an order for 1,000 units was completed and incurred the following: The accountant computed the inventory cost of this order to be 4.30 per unit. The annual budgeted overhead in dollars was: a. 577,500. b. 600,000. c. 645,000. d. 660,000.