Multiple predetermined overhead rates: a. improves job-order costing's accuracy accounting for costs. b. are based on actual total manufacturing overhead costs С. are calculated at the ending of the accounting period once the actual amount of manufacturing overhead is known. d. All the given answers are NOT correct. e. calculated for each department by dividing total estimated manufacturing overhead cost by total actual units of the allocation base.

Multiple predetermined overhead rates: a. improves job-order costing's accuracy accounting for costs. b. are based on actual total manufacturing overhead costs С. are calculated at the ending of the accounting period once the actual amount of manufacturing overhead is known. d. All the given answers are NOT correct. e. calculated for each department by dividing total estimated manufacturing overhead cost by total actual units of the allocation base.

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Description: Multiple predetermined overhead rates:a. improves job-order costing'saccuracy accounting for costs.b. are based on actual totalmanufacturing overhead costsС.are calculated at the ending ofthe accounting period once theactual amount of manufacturingo

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 1MC: Which of the following product situations is better suited to job order costing than to process...

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Similar questions

A company has traditionally allocated its overhead based on machine hours but had collected this information to change to activity-based costing: A. How much overhead would be allocated to each unit under the traditional allocation method? B. How much overhead would be allocated to each unit under activity-based costing?
Assigning indirect costs to departments is completed by __________________________. applying the predetermined overhead rate debiting the manufacturing costs incurred applying the costs to manufacturing overhead applying the costs to work in process inventory
Overhead costs are assigned to each product based on __________________. A. the proportion of that products use of the cost driver B. a predetermined overhead rate for a single cost driver C. price of the product D. machine hours per product
Assigning indirect costs to specific jobs is completed by which of the following? applying the costs to manufacturing overhead using the predetermined overhead rate using the manufacturing costs incurred applying the indirect labor to the work in process inventory
Primera Company produces two products and uses a predetermined overhead rate to apply overhead. Primera currently applies overhead using a plantwide rate based on direct labor hours. Consideration is being given to the use of departmental overhead rates where overhead would be applied on the basis of direct labor hours in Department 1 and on the basis of machine hours in Department 2. At the beginning of the year, the following estimates are provided: Actual results reported by department and product during the year are as follows: Required: 1. Compute the plantwide predetermined overhead rate and calculate the overhead assigned to each product. 2. Calculate the predetermined departmental overhead rates and calculate the overhead assigned to each product. 3. Using departmental rates, compute the applied overhead for the year. What is the under- or overapplied overhead for the firm? 4. Prepare the journal entry that disposes of the overhead variance calculated in Requirement 3, assuming it is not material in amount. What additional information would you need if the variance is material to make the appropriate journal entry?
During production, to what are the costs in job order costing applied? A. manufacturing overhead B. cost of goods sold C. each individual product D. each individual department
Cost Flows Consider the following independent jobs. Overhead is applied in Department 1 at the rate of 6 per direct labor hour. Overhead is applied in Department 2 at the rate of 8 per machine hour. Direct labor wages average 10 per hour in each department. Required: Fill in the missing data for each job.
Carltons Kitchens three cost pools and overhead estimates are as follows: Compare the overhead allocation using: A. The traditional allocation method B. The activity-based costing method (Hint: the traditional method uses machine hours as the allocation base.)
Refer to the data in Exercise 7.20. The company has decided to use the sequential method of allocation instead of the direct method. The support departments are ranked in order of highest cost to lowest cost. Required: 1. Allocate the overhead costs to the producing departments using the sequential method. (Take allocation ratios out to four significant digits. Round allocated costs to the nearest dollar.) 2. Using machine hours, compute departmental overhead rates. (Round the overhead rates to the nearest cent.)
Job order cost sheets show the following costs assigned to each job: The company assigns overhead at twice the direct labor cost. What is the total cost for each job?
Overhead application rate Creole Manufacturing Inc. uses a job order cost system and standard costs. It manufactures one product, whose standard cost follows: The standards are based on normal capacity of 2,400 direct labor hours. Actual activity for October follows: Required: 1. Compute the variable and fixed factory overhead rates per unit. 2. Compute the variable and fixed overhead rates per direct labor hour. 3. Determine the total fixed factory overhead based on normal capacity.
Determining job costcalculation of predetermined rate for applying overhead by direct labor cost and direct labor hour methods Beemer Products Inc. has its factory divided into three departments, with individual factory overhead rates for each department. In each department, all the operations are sufficiently alike for the department to be regarded as a cost center. The estimated monthly factory overhead for the departments is as follows: Forming, 64,000; Shaping, 36,000; and Finishing, 10,080. The estimated production data include the following: The job cost ledger shows the following data for X6, which was completed during the month: Required: Determine the cost of X6. Assume that the factory overhead is applied to production orders, based on the following: 1. Direct labor cost 2. Direct labor hours (Hint: You must first determine overhead rates for each department, rounding rates to the nearest cent.)