manufacturing overhead for
Q: How have advances in manufacturing technology affected overhead application?
A: Overhead application: It is a process of allocating the cost to the jobs, the allocation of cost is…
Q: Compute the Predetermined Overhead Rate.
A: Predetermined Overhead rate is the rate at which the Overhead is applied to the Product based on the…
Q: Compute the actual manufacturing overhead and applied manufacturing overhead
A: Manufacturing overhead can be defined as the cost incurred upon the manufacturing or production of…
Q: Describe fixed manufacturing overhead under absorption costing.
A: Absorption costing: Under this method, manufacturing cost such as direct material and labor is…
Q: Which of the following is the step in which materials, labor, and overhead are detailed?
A: Direct material is the cost of the raw materials or parts that go directly into the production of a…
Q: How to identify costs incurredfor direct materials in a job
A: How to identify cost incurred for direct materials
Q: Explain fixed manufacturing overhead.
A: Manufacturing overhead costs: The costs, which do not relate openly with the manufacturing of…
Q: How to calculate manufacturing cost per unit
A: Manufacturing cost can be defined as the cost that is incurred while producing a product. It…
Q: Which of these are factory overhead
A: Factory overhead includes: Rent cost on factory equipment Factory utilities…
Q: construction in process account
A: Construction contracts are contracts made by one person with other to involve in construction…
Q: labor utilization
A: Labor utilization is the percentage of effective time workers are engaged in the production process.…
Q: Explain manufacturing overhead costs.
A: Manufacturing overheads costs refer to the amount of cost incurred as indirect expenses for…
Q: Manufacturing overhead is
A: Predetermined overhead application rate is - (Estimated overhead costs)/(Total Direct labours) Note…
Q: Direct material Direct labor Overhead Total
A: The overheads are applied to production on the basis of predetermined overhead rate. As per…
Q: e activity-based factory overhead per unit f
A: Under activity-based costing technique costs are assigned to each product based on cost drivers…
Q: manufacturing overhead handled in a process cost system
A: Indirect cost is the cost that is not directly involved in the production process of the company.
Q: Distinguish between the product-costing and control purposes of standardcosts for factory…
A: Standard Costing: Standard costing is an accounting tool which is used to measure the variances in…
Q: predetermined overhead rate
A: Predetermined overhead rate = Total estimated overhead/Total machine hours
Q: Describe the use of process costing.
A: Process Costing: Process costing is method of cost accounting in which all the costs that are…
Q: Record the application of manufacturing overhead to production. 1
A: 1) Overhead rate = $182,400/19000 = 9.60 per labor hour Journal entry Transaction General Journal…
Q: Define the term manufacturing overheads.
A: Manufacturing overhead is all indirect costs incurred during the production process. This overhead…
Q: differentiate between job and contract costing
A: Answer : JOB COSTING = Job costing is an accounting method which track the cost of individual…
Q: factory overheads:
A: Correct Answer is Option B = i , v , vi I.e = Production foremen salaries , Indirect factory labour…
Q: Should design of cost be in factory overhead? Explain why
A: Factory overheads are the costs related to the manufacture of the goods.
Q: How much is Work in Process-Direct Labor?
A: Payroll The process of payroll to calculate the total labor hours which are included in the time…
Q: Job order costing:
A: Job order costing is the system of allocating manufacturing overheads to specific jobs. This is used…
Q: predetermined overhead rate for each activity base.
A: Predetermined overhead rate = Estimated annual manufacturing overhead costs/Estimated annual…
Q: Different between raw materials, work in process and finished goods inventories
A: A manufacturing company generally have three types of inventories in its stock: Raw Materials Work…
Q: Preparing a summary journal entry to record allocation of manufacturing overhead
A: Preparation of a summary journal entry to record allocation of manufacturing overhead. We have,The…
Q: Compute the Manufacturing Overhead Applied to Jobs;
A: Overhead cost allocation: It is the process of allocating the estimated overhead of a company to its…
Q: Describe how a single plantwide overhead allocation rate is used.
A: Cost: It refers to the economic value incurred by a company to produce a product or a service.
Q: Units of production method with workings required.
A: Depreciation is a decrease in the value of assets due to normal wear and tear, the effect of time,…
Q: Process Costing - Assem ding inventory production for
A: Work in progress inventory refers to the inventory which is still being in process of converting…
Q: Define Overhead Allocation.
A: Activity-Based Costing: It is a method that helps in finding the activities performed by a company…
Q: How to compute manufacturing overhead?
A: In order to manufacture the product, various indirect expenses are incurred such as indirect…
Q: Describe the two-stage process associated with plantwide overhead rates.
A: Cost accounting is the branch of accounting that inspects the cost structure of a business. This…
Q: Define the following: (a) direct materials, (b) indirect materials, (c) direct labor, (d) indirect…
A: Cost: Cost can be defined as the cash and cash equivalent which is incurred against the products…
Q: Describe weighted average method under process costing.
A: Process Costing: Process costing is method of cost accounting in which all the costs that are…
Q: What manufacturing cost term is used to describe the cost of materials that are an integral part of…
A: Cost: The amount paid to purchase the asset, install it, and put it into operations, is referred to…
Q: Explain an example of manufacturing overhead.
A: Manufacturing overhead costs: “The costs, which do not relate directly with the manufacturing of…
Q: raw material used
A: Raw material used = Opening raw materials + Raw materials purchased - Closing raw materials
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- Business Specialty, Inc., manufactures two staplers: small and regular. The standard quantities of direct labor and direct materials per unit for the year are as follows: The standard price paid per pound of direct materials is 1.60. The standard rate for labor is 8.00. Overhead is applied on the basis of direct labor hours. A plantwide rate is used. Budgeted overhead for the year is as follows: The company expects to work 12,000 direct labor hours during the year; standard overhead rates are computed using this activity level. For every small stapler produced, the company produces two regular staplers. Actual operating data for the year are as follows: a. Units produced: small staplers, 35,000; regular staplers, 70,000. b. Direct materials purchased and used: 56,000 pounds at 1.5513,000 for the small stapler and 43,000 for the regular stapler. There were no beginning or ending direct materials inventories. c. Direct labor: 14,800 hours3,600 hours for the small stapler and 11,200 hours for the regular stapler. Total cost of direct labor: 114,700. d. Variable overhead: 607,500. e. Fixed overhead: 350,000. Required: 1. Prepare a standard cost sheet showing the unit cost for each product. 2. Compute the direct materials price and usage variances for each product. Prepare journal entries to record direct materials activity. 3. Compute the direct labor rate and efficiency variances for each product. Prepare journal entries to record direct labor activity. 4. Compute the variances for fixed and variable overhead. Prepare journal entries to record overhead activity. All variances are closed to Cost of Goods Sold. 5. Assume that you know only the total direct materials used for both products and the total direct labor hours used for both products. Can you compute the total direct materials and direct labor usage variances? Explain.Direct labor hours are estimated as 2,000 in Quarter 1; 2,100 in Quarter 2; 1,900 in Quarter 3; and 2,300 in Quarter 4. Prepare a manufacturing overhead budget using the information provided.John Sheng, a cost accountant at Starlet Company, is developing departmental factory overhead application rates for the companys Tooling and Fabricating departments. The budgeted overhead for each department and the data for one job are as follows: Using the departmental overhead application rates, total overhead applied to Job 231 in the Tooling and Fabricating departments will be: a. 225. b. 303. c. 537. d. 671.
- Cynthia Rogers, the cost accountant for Sanford Manufacturing, is preparing a management report that must include an allocation of overhead. The budgeted overhead for each department and the data for one job are as follows: Using the departmental overhead application rates, and allocating overhead on the basis of direct labor hours, overhead applied to Job 231 in the Tooling Department would be: a. 44.00. b. 197.50. c. 241.50. d. 501.00.Minor Co. has a job order cost system and applies overhead based on departmental rates. Service Department 1 has total budgeted costs of 168,000 for next year. Service Department 2 has total budgeted costs of 280,000 for next year. Minor allocates service department costs solely to the producing departments. Service Department 1 cost is allocated to producing departments on the basis of machine hours. Service Department 2 cost is allocated to producing departments on the basis of direct labor hours. Producing Department 1 has budgeted 8,000 machine hours and 12,000 direct labor hours. Producing Department 2 has budgeted 2,000 machine hours and 12,000 direct labor hours. What is the total cost allocation from the two service departments to Producing Department 1? a. 173,600 b. 140,000 c. 134,400 d. 274,400Douglas Davis, controller for Marston, Inc., prepared the following budget for manufacturing costs at two different levels of activity for 20X1: During 20X1, Marston worked a total of 80,000 direct labor hours, used 250,000 machine hours, made 32,000 moves, and performed 120 batch inspections. The following actual costs were incurred: Marston applies overhead using rates based on direct labor hours, machine hours, number of moves, and number of batches. The second level of activity (the right column in the preceding table) is the practical level of activity (the available activity for resources acquired in advance of usage) and is used to compute predetermined overhead pool rates. Required: 1. Prepare a performance report for Marstons manufacturing costs in the current year. 2. Assume that one of the products produced by Marston is budgeted to use 10,000 direct labor hours, 15,000 machine hours, and 500 moves and will be produced in five batches. A total of 10,000 units will be produced during the year. Calculate the budgeted unit manufacturing cost. 3. One of Marstons managers said the following: Budgeting at the activity level makes a lot of sense. It really helps us manage costs better. But the previous budget really needs to provide more detailed information. For example, I know that the moving materials activity involves the use of forklifts and operators, and this information is lost when only the total cost of the activity for various levels of output is reported. We have four forklifts, each capable of providing 10,000 moves per year. We lease these forklifts for five years, at 10,000 per year. Furthermore, for our two shifts, we need up to eight operators if we run all four forklifts. Each operator is paid a salary of 30,000 per year. Also, I know that fuel costs about 0.25 per move. Assuming that these are the only three items, expand the detail of the flexible budget for moving materials to reveal the cost of these three resource items for 20,000 moves and 40,000 moves, respectively. Based on these comments, explain how this additional information can help Marston better manage its costs. (Especially consider how activity-based budgeting may provide useful information for non-value-added activities.)
- 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.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?Cost and production data for Binghamton Beverages Inc. are presented as follows: Required: Calculate net variances for materials, labor, and factory overhead. Calculate specific materials and labor variances by department, using the diagram format in Figure 8-4. Comment on the possible causes for each of the variances that you computed. Make all journal entries to record production costs in Work in Process and Finished Goods. Determine the balance of ending Work in Process in each department. Assume that 4,000 units were sold at $40 each. Calculate the gross margin based on standard cost. Calculate the gross margin based on actual cost. Why does the gross margin at actual cost differ from the gross margin at standard cost. As the plant controller, you present the variance report in Item 1 above to Paul Crooke, the plant manager. After reading it, Paul states: “If we present this performance report to corporate with that large unfavorable labor variance in Blending, nobody in the plant will receive a bonus. Those standard hours of 5,500 are way too tight for this production process. Fifty-eight hundred hours would be more reasonable, and that would result in a favorable labor efficiency variance that would more than offset the unfavorable labor rate variance. Please redo the variance calculations using 5,800 hours as the standard.” You object, but Paul ends the conversation with, “That is an order.” What standards of ethical professional practice would be violated if you adhered to Paul’s order? How would you attempt to resolve this ethical conflict?
- Factory overhead cost budget Sweet Tooth Candy Company budgeted the following costs for anticipated production for August: Prepare a factory overhead cost budget, separating variable and fixed costs. Assume that factory insurance and depreciation are the only fixed factory costs.Georgia Gasket Co. budgets 8,000 direct labor hours for the year. The total overhead budget is expected to amount to 20,000. The standard cost for a unit of the companys product estimates the variable overhead as follows: The actual data for the period follow: Using the four-variance method, calculate the overhead variances. (Hint: First compute the budgeted fixed overhead rate.)Calculating amount of factory overhead applied to work in process The overhead application rate for a company is 2.50 per unit, made up of 1.00 for fixed overhead and 1.50 for variable overhead. Normal capacity is 10,000 units. In one month, there was an unfavorable flexible budget variance of 200. Actual overhead for the month was 27,000. What was the amount of the budgeted overhead for the actual level of production?
