(d) Post the manufacturing overhead transactions to the Manufacturing Overhead T-account, clearly showing the balance before closing the account. State the journal entries necessary to dispose of the variance. Assume that the manufacturing overhead variance is immaterial. (e) What is the balance in the Cost of Goods Sold account after the adjustment? (f) Compute Elite's gross profit earned on the jobs sold, after adjusting for the manufacturing overhead variance (g) Post the appropriate entries to Work in Process Inventory account & determine the account balance on March 31, the end of the quarter.
Q: Calculate the predetermined plantwide overhead rate. (Note: Round to the nearest cent.) ii)…
A: Variance is the measurement which is used by the company in order to measure about the costs and…
Q: Post the manufacturing overhead transactions to the Manufacturing Overhead T-account, clearly…
A: SOLUTION D- MANUFACTURING OVERHEAD T ACCOUNT iv 30000…
Q: The company applies varlable overhead on the basis of direct labor-hours. The direct materials…
A: Formula: Material Quantity Variance= SQ-AQ×SP where, SQ is Standard Quantity for Actual Output AQ is…
Q: a) Post the manufacturing overhead transactions to the Manufacturing Overhead T-account. What is the…
A: Predetermined Overhead Rate=Total estimated factory overheadTotal estimated direct labour cost×100
Q: Mills, Inc. uses a standard cost system and provides the following information. E (Click the icon to…
A: Analysis of variance The discrepancy between actual and budgeted data is referred to as variance. In…
Q: The records of Nysa Company revealed the following for the current year: Work-in-process inventory,…
A: “Since you have asked multiple sub-parts, we will solve the first three sub-parts for you. If you…
Q: Required: Prepare the joumal entries to record the above variances, including the recording of the…
A: Journla entry is part of book keeping .
Q: (d) Post the manufacturing overhead transactions to the Manufacturing Overhead T-account, clearly…
A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…
Q: Using direct labour hours as the cost driver, the journal entry to dispose of the manufacturing…
A: “Since you have asked multiple question, we will solve the first question for you. If youwant any…
Q: The following direct materials variance analysis was performed for Smithson. 1(Click the icon to…
A: Smithson's direct materials variance analysis was performed as follows: AC × AQ SC ×…
Q: The predetermined overhead rate (budgeted overhead rate) is ordinarily developed at the end of the…
A: The above statement is False
Q: 3. Prepare the journal entries associated with direct materials and direct labor. If an amount box…
A: Material cost variances shows difference in standard cost and actual cost of materials due to…
Q: Following information has been obtained from the records of a manufacturing organisation using the…
A:
Q: (a) Compute KRAFT ‘R’ US’ predetermined manufacturing overhead rate for 20X8. (b) State the journal…
A: Job costing: It is a method of costing where in all the costs like direct material, direct labor and…
Q: Two jobs were completed with total costs of $183,000 and $105,000 respectively. They were sold to…
A: A manufacturing overhead cost variance refers to the difference between the cost budgeted during the…
Q: Quality Company uses a standard cost system and reports the following information for 2024:…
A: Cost Variance: Cost variance is the difference between the actual cost and the budgeted cost.
Q: Wright Brothers is debating the use of direct labor cost or direct labor hours as the cost…
A: The manufacturing overhead cost is applied to production on the basis of Predetermined overhead…
Q: Butrico Manufacturing Corporation uses a standard cost system, records materials price variances…
A: SOLUTION COST OF GOOD SOLD = SALES - GROSS PROFIT.
Q: Proration of Variances; Chapters 14 and 15 Butrico Manufacturing Corporation uses a standard cost…
A: 1.
Q: You run a fabric store and order materials through a supplier. At the end of the month, you review…
A: Direct material(D/M) variance: it is basically the standard cost of the D/M minus the actual cost…
Q: 28. If at the end of the fiscal year, the variances from standard are significant, the variances…
A: At the end of the financial year, any variances which are significant from the standard measures of…
Q: Butrico Manufacturing Corporation uses a standard cost system, records materials price variances…
A: Variance: Variance refers to the difference level in the actual cost incurred and standard cost. The…
Q: Using the following data from the records of Starts Inc. for November of the current year, prepare…
A: Since the cost of goods sold given in the question is standard, any favorable direct material,…
Q: a company uses a standard cost system. The ending balance in the Manufacturing Overhead account Is a…
A: The manufacturing overhead may be underapplied or overapplied depending on the actual overheads…
Q: Prepare an income statement (through income before income tax) for presentation to management, using…
A: The income statement of an organization shows all incomes or revenue and expenses of an organization…
Q: Eric Williams is a cost accountant and business analyst for Diamond Design Company (DDC), which…
A: Lets understand the basics. Direct material price variance is a variance between the rate at which…
Q: At the end of the fiscal year, variances from standard costs are usually transferred to the…
A: Variance refers to a change between the expected value and the actual result. This term is usually…
Q: REQUIREMIENTS: What is the predetermined overhead rate? What is the amount of overhead applied for…
A: Overheads are the indirect costs related to production of goods.
Q: Example: To continue the example, assume XYZ Company incurred $180,000 of manufacturing expenses and…
A: The problem consists of three sub parts. So we will solve each part in a separate step. We have to…
Q: The Pukalani Company uses a standard costing system. During 2021, the company incurred actual…
A: Overhead: The term "overhead" refers to any continuing costs incurred by a company that are not…
Q: A change in the quality of materials purchased A new supplier contract Error in the accounting…
A: 1) Material price variance = Material price variance occurs when the actual price paid is more or…
Q: The journal entry to record the direct materials quantity variance may be recorded Group of answer…
A: The variance is the difference between the actual data and standard output of the production.
Q: Please redo this problem and show me steps on how to get the following questions correct, its…
A: Direct labor variance is calculated to check the difference between actual labor cost & standard…
Q: Prepare a factory overhead cost variance report for May. To be useful for cost control, the budgeted…
A:
Q: Butrico Manufacturing Corporation uses a standard cost system, records materials price variances…
A: Answer - Direct Materials Price Variance - Direct material price variance is the difference…
Q: Required information [The following information applies to the questions displayed below.] Alvarez…
A: Journal entries are prepared to record the financial and non-financial transactions of the business…
Q: Factory Actual labor hours Estimated labor hours Estimated Costs
A: Total Estimated Costs: Variable - 7,20,000…
Q: The following labor standards have been established for a particular product: The following data…
A: Labour Efficiency Variance = (Standard hours - Actual hours) * standard rate Standard hours = 1400 *…
Q: MajorNet Systems’s static budget predicted production of and sales of 100 connectors in August, but…
A: Journal entry: Journal entry is a set of economic events that can be measured in monetary terms.…
Q: Example: Using the direct labor standards for the production process at Hardrock Quarry, Inc. as…
A: In given problem we have to compute variance for Hard rock Quarry, Inc. We have given two sub parts…
Q: Rainbow Company uses standard cost system for its production process. Rainbow Company applies…
A: Working: Budgeted VOH/Actual = Direct Labor Hour x Standard Variable Overhead Rate…
Q: Predetermined Overhead Rates, Overhead Variances, Unit Costs Primera Company produces two products…
A: Departmental overhead rates are calculated in a similar way to the single-plant wide rate, except…
Q: Required: (a) Compute, BuiltbyHands Stores predetermined manufacturing overhead rate for 20X8. (b)…
A: Job costing: It is a method of costing where in all the costs like direct material, direct labor and…
Please continue with part sub-part d of this question.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 7 images
- 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?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.Rockford Company has four departmental accounts: Building Maintenance, General Factory Overhead, Machining, and Assembly. The direct labor hour method is used to apply factory overhead to the jobs being worked on in Machining and Assembly. The company expects each production department to use 30,000 direct labor hours during the year. The estimated overhead rates for the year include the following: During the year, both Machining and Assembly used 28,000 direct labor hours. Factory overhead costs incurred during the year follow: In determining application rates at the beginning of the year, cost allocations were made as follows, using the sequential distribution method: Building Maintenance to: General Factory Overhead, 10%; Machining, 50%; Assembly, 40%. General factory overhead was distributed according to direct labor hours. Required: Determine the under- or overapplied overhead for each production department. (Hint: First you must distribute the service department costs.)
- Compute the total job cost for each of the following scenarios: a. If the direct labor cost method is used in applying factory overhead and the predetermined rate is 100%, what amount should be charged to Job 2010 for factory overhead? Assume that direct materials used totaled 5,000 and that the direct labor cost totaled 3,200. b. If the direct labor hour method is used in applying factory overhead and the predetermined rate is 10 an hour, what amount should be charged to Job 2010 for factory overhead? Assume that the direct materials used totaled 5,000, the direct labor cost totaled 3,200, and the number of direct labor hours totaled 250. c. If the machine hour method is used in applying factory overhead and the predetermined rate is 12.50 an hour, what amount should be charged to Job 2010 for factory overhead? Assume that the direct materials used totaled 5,000, the direct labor cost totaled 3,200, the direct labor hours were 250 hours, and the machine hours were 295 hours.Chrome Solutions Company manufactures special chromed parts made to the order and specifications of the customer. It has two production departments, Stamping and Plating, and two service departments, Power and Maintenance. In any production department, the job in process is wholly completed before the next job is started. The company operates on a fiscal year, which ends September 30. Following is the post-closing trial balance as of September 30: Additional information: The balance of the materials account represents the following: The company uses the FIFO method of accounting for all inventories. Material A is used in the Stamping Department, and materials B and C are used in the Plating Department. The balance of the work in process account represents the following costs that are applicable to Job 905. (The customer’s order is for 1,000 units of the finished product.) The finished goods account reflects the cost of Job 803, which was finished at the end of the preceding month and is awaiting delivery orders from the customer. At the beginning of the year, factory overhead application rates were based on the following data: In October, the following transactions were recorded: Purchased the following materials and supplies on account: The following materials were issued to the factory: Customers’ orders covered by Jobs 1001 and 1002 are for 1,000 and 500 units of finished product, respectively. Factory wages and office, sales, and administrative salaries are paid at the end of each month. (Assume FICA and federal income tax rates of 8% and 10%, respectively.) Record the company’s liability for state and federal unemployment taxes. (Assume rates of 4% and 1%, respectively, and that none of the employees had reached the $8,000 limit.) Record the payroll distribution for October. Wages of the supervisors, custodial personnel, etc., totaled $9,500; administrative salaries were $18,300. Miscellaneous factory overhead incurred during October totaled $4,230. Miscellaneous selling and administrative expenses were $1,500. These items as well as the FICA tax and federal income tax withheld for September were paid. (See account balances on the post-closing trial balance for September 30.) Annual depreciation on plant assets is calculated using the following rates (round to nearest dollar): Factory buildings–5% Machinery and equipment–20% Office equipment–20% The balance of the prepaid insurance account represents a three-year premium for a fire insurance policy covering the factory building and machinery. It was paid on the last day of the preceding month and became effective on October 1. The summary of factory overhead prepared from the factory overhead ledger is reproduced here: The total expenses of the Maintenance Department are distributed on the basis of floor space occupied by the Power Department (8,820 sq ft), Stamping Department (19,500 sq ft), and Plating Department (7,875 sq ft). The power department expenses are then allocated equally to the Stamping and Plating departments. After the actual factory overhead expenses have been distributed to the departmental accounts and the applied factory overhead has been recorded and posted, any balances in the departmental accounts are transferred to Under- and Overapplied Overhead. Jobs 905 and 1001 were finished during the month. Job 1002 is still in process at the end of the month. During the month, Jobs 803 and 905 were sold with a mark-on percentage of 50% on cost. Received $55,500 from customers in payment of their accounts. Checks were issued in the amount of $43,706 for payment of the payroll. Required: Set up the beginning trial balance in T-accounts. Prepare materials inventory ledger cards and enter October 1 balances. Prepare a Payroll Summary and Schedule of Earnings and Payroll Taxes for the month of October. Set up job cost sheets as needed. Record all transactions and related entries for October and post to T-accounts. Prepare a service department expense distribution worksheet for October. At the end of the month: Analyze the balance in the materials account, the work in process account, and the finished goods account. Prepare the statement of cost of goods manufactured for the month ended October 31.When setting its predetermined overhead application race, Tasty Box Meals estimated its overhead would be $100,000 and would require 25,000 machine hours in the next year. At the end of the year. It found that actual overhead was $102,000 and required 26,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under applied or over applied 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?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?Pocono Cement Forms expects $900,000 in overhead during the next year. It does not know whether it should apply overhead on the basis of its anticipated direct labor hours of 60,000 or its expected machine hours of 30,000. Determine the product cost under each predetermined allocation rate if the last job incurred $1,550 in direct material cost, 90 direct labor hours, and 75 machine hours. Wages are paid at $16 per hour.
- Self-Construction Olson Machine Company manufactures small and large milling machines. Selling prices of these machines range from 35,000 to 200,000. During the 5-month period from August 1, 2019, through December 31, 2019, Olson manufactured a milling machine for its own use. This machine was built as part of the regular production activities. The project required a large amount of time front planning and supervisory personnel, as well as that of some of the companys officers, because it was a more sophisticated type of machine than the regular production models. Throughout the 5-month period, Olson charged all costs directly associated with the construction of the machine to a special account entitled Asset Construction Account. An analysis of the charges to this account as of December 31, 2019, follows: Olson allocates factory overhead to normal production as a percent of direct labor dollars as follows: Olson uses a flat rate of 40% of direct labor dollars to allocate general and administrative overhead. During the machine testing period, a cutter head malfunctioned and did extensive damage to the machine table and one cutter housing. This damage was not anticipated and was the result of an error in the assembly operation. Although no additional raw materials were needed to make the machine operational after the accident, the following labor for rework was required: Olson has included all these labor charges in the asset construction account. In addition, it included in the account the repairs and maintenance charges of 1,340 that it incurred as a result of the malfunction. Required: 1. Compute, consistent with GAAP and common practice, the amount that Olson should capitalize for the milling machine as of December 31, 2019, when it declares the machine operational. 2. Next Level Identify the costs you included in Requirement 1 for which there are acceptable alternative procedures. Describe the alternative procedure(s) in each case.Narwhal Swimwear has a beginning work in process inventory of 13,500 units and transferred in 130,000 units before ending the month with 14,000 units that were 100% complete with regard to materials and 30% complete with regard to conversion costs. The cost per unit of material is $5.80 and the cost per unit for conversion is $8.20 per unit. Using the weighted-average method, what is the amount of material and conversion costs assigned to the department for the month?Davis Co. uses backflush costing to account for its manufacturing costs. The trigger points are the purchase of materials, the completion of goods, and the sale of goods. Prepare journal entries to account for the following: a. Purchased raw materials, on account, 70,000. b. Requisitioned raw materials to production, 70,000. c. Distributed direct labor costs, 15,000. d. Factory overhead costs incurred, 45,000. (Use Various Credits for the account in the credit part of the entry.) e. Completed all of the production started. f. Sold the completed production for 195,000, on account. (Hint: Use a single account for raw materials and work in process.)