Please complete the following five exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculations within Excel cells is acceptable). Save the document, and submit it in the appropriate week using the Assignment Submission button. 1. Overhead application: Working backward The Towson Manufacturing Corporation applies overhead on the basis of machine hours. The following divisional information is presented for your review: Division A Division B Actual machine hours 22,500 ? Estimated machine hours 20,000 ? Overhead application rate $4.50 $5.00 Actual overhead $110,000 ? Estimated overhead ? $90,000 Applied overhead ? $86,000 Over- (under-) applied overhead ? $6,500 Find the unknowns for each of the divisions. 2. Computationsusing a job order system General Corporation employs a job order cost system. On May 1 the following balances were extracted from the general ledger; Work in process $ 35,200 Finished goods 86,900 Cost of goods sold 128,700 Work in Process consisted of two jobs, no. 101 ($20,400) and no. 103 ($14,800). During May, direct materials requisitioned from the storeroom amounted to $96,500, and direct labor incurred totaled $114,500. These figures are subdivided as follows: Direct Materials Direct Labor Job No. Amount Job No. Amount 101 $5,000 101 $7,800 115 19,500 103 20,800 116 36,200 115 42,000 Other 35,800 116 18,000 $96,500 Other 25,900 $114,500 Job no. 115 was the only job in process at the end of the month. Job no. 101 and three "other" jobs were sold during May at a profit of 20% of cost. The "other" jobs contained material and labor charges of $21,000 and $17,400, respectively. General applies overhead daily at the rate of 150% of direct labor cost as labor summaries are posted to job orders. The firm's fiscal year ends on May 31. Instructions: a. Compute the total overhead applied to production during May. b. Compute the cost of the ending work in process inventory. c. Compute the cost of jobs completed during May. d. Compute the cost of goods sold for the year ended May 31. 3. High-low methodThe following cost data pertain to 20X6 operations of Heritage Products: Quarter 1 Quarter 2 Quarter 3 Quarter 4 Shipping costs $58,200 $58,620 $60,125 $59,400 Orders shipped 120 140 175 150 The company uses the high-low method to analyze costs. a. Determine the variable cost per order shipped. b. Determine the fixed shipping costs per quarter. c. If present cost behavior patterns continue, determine total shipping costs for 20X7 if activity amounts to 570 orders.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Please complete the following five exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculations within Excel cells is acceptable). Save the document, and submit it in the appropriate week using the Assignment Submission button.
1.
The Towson Manufacturing Corporation applies overhead on the basis of machine hours. The following divisional information is presented for your review:
|
Division A |
Division B |
|
|
Actual machine hours |
22,500 |
? |
|
Estimated machine hours |
20,000 |
? |
|
Overhead application rate |
$4.50 |
$5.00 |
|
Actual overhead |
$110,000 |
? |
|
Estimated overhead |
? |
$90,000 |
|
Applied overhead |
? |
$86,000 |
|
Over- (under-) applied overhead |
? |
$6,500 |
Find the unknowns for each of the divisions.
2. Computationsusing a job order system
General Corporation employs a job order cost system. On May 1 the following balances were extracted from the general ledger;
Work in process $ 35,200
Finished goods 86,900
Cost of goods sold 128,700
Work in Process consisted of two jobs, no. 101 ($20,400) and no. 103 ($14,800). During May, direct materials requisitioned from the storeroom amounted to $96,500, and direct labor incurred totaled $114,500. These figures are subdivided as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Job no. 115 was the only job in process at the end of the month. Job no. 101 and three "other" jobs were sold during May at a profit of 20% of cost. The "other" jobs contained material and labor charges of $21,000 and $17,400, respectively.
General applies overhead daily at the rate of 150% of direct labor cost as labor summaries are posted to job orders. The firm's fiscal year ends on May 31.
Instructions:
a. Compute the total overhead applied to production during May.
b. Compute the cost of the ending work in process inventory.
c. Compute the
d. Compute the cost of goods sold for the year ended May 31.
3. High-low method
The following cost data pertain to 20X6 operations of Heritage Products:
|
Quarter 1 |
Quarter 2 |
Quarter 3 |
Quarter 4 |
|
|
Shipping costs |
$58,200 |
$58,620 |
$60,125 |
$59,400 |
|
Orders shipped |
120 |
140 |
175 |
150 |
The company uses the high-low method to analyze costs.
a. Determine the variable cost per order shipped.
b. Determine the fixed shipping costs per quarter.
c. If present cost behavior patterns continue, determine total shipping costs for 20X7 if activity amounts to 570 orders.
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