Muñoz Corporation estimated its overhead costs would be $22,800 per mon insurance premium on the manufacturing facility. Accordingly, the January ov $22,800). The company expected to use 7,400 direct labor hours per month company expected 9,900 hours of direct labor each month to build inventori Christmas season. The company's actual direct labor hours were the same a product in each month except July, August, and September, in which it produ $24.80 per unit, and direct materials costs were $11.50 per unit.

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter4: Job Order Costing
Section: Chapter Questions
Problem 2PB: Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500...
icon
Related questions
Question
Munoz Corporation estimated its overhead costs would be $22,800 per month except for January when it pays the $179,010 annual
insurance premium on the manufacturing facility. Accordingly, the January overhead costs were expected to be $201.810 ($179,010 +
$22,800). The company expected to use 7.400 direct labor hours per month except during July, August, and September when the
company expected 9,900 hours of direct labor each month to build inventories for high demand that normally occurs during the
Christmas season. The company's actual direct labor hours were the same as the estimated hours. The company made 3,700 units of
product in each month except July, August, and September, in which it produced 4,950 units each month. Direct labor costs were
$24.80 per unit, and direct materials costs were $11.50 per unit.
Required
a. Calculate a predetermined overhead rate based on direct labor hours.
b. Determine the total allocated overhead cost for January, March, and August.
c. Determine the cost per unit of product for January, March, and August.
d. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $21.60 per unit.
Complete this question by entering your answers in the tabs below.
Reg A
Req B to D
b. Determine the total allocated overhead cost for January, March, and August.
c. Determine the cost per unit of product for January, March, and August.
d. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $21.60 per unit.
Note: Do not round intermediate calculations. Round "Cost per unit" and "Selling price per unit" to 2 decimal places. Round
your total allocated overhead cost to nearest whole dollar.
b. Total allocated overhead cost
c. Cost per unit
d. Selling price per unit
January
March
< Req A
August
He to >
Show less A
Transcribed Image Text:Munoz Corporation estimated its overhead costs would be $22,800 per month except for January when it pays the $179,010 annual insurance premium on the manufacturing facility. Accordingly, the January overhead costs were expected to be $201.810 ($179,010 + $22,800). The company expected to use 7.400 direct labor hours per month except during July, August, and September when the company expected 9,900 hours of direct labor each month to build inventories for high demand that normally occurs during the Christmas season. The company's actual direct labor hours were the same as the estimated hours. The company made 3,700 units of product in each month except July, August, and September, in which it produced 4,950 units each month. Direct labor costs were $24.80 per unit, and direct materials costs were $11.50 per unit. Required a. Calculate a predetermined overhead rate based on direct labor hours. b. Determine the total allocated overhead cost for January, March, and August. c. Determine the cost per unit of product for January, March, and August. d. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $21.60 per unit. Complete this question by entering your answers in the tabs below. Reg A Req B to D b. Determine the total allocated overhead cost for January, March, and August. c. Determine the cost per unit of product for January, March, and August. d. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $21.60 per unit. Note: Do not round intermediate calculations. Round "Cost per unit" and "Selling price per unit" to 2 decimal places. Round your total allocated overhead cost to nearest whole dollar. b. Total allocated overhead cost c. Cost per unit d. Selling price per unit January March < Req A August He to > Show less A
Expert Solution
steps

Step by step

Solved in 3 steps with 1 images

Blurred answer
Knowledge Booster
Capital Budgeting
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Principles of Accounting Volume 2
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Cost Accounting
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,