Problem 2-24 (Algo) Plantwide Versus Multiple Predetermined Overhead Rates [LO2-1, LO2-2] Mason Company has two manufacturing departments-Machining and Assembly. All of the company's manufacturing overhead costs are fixed costs. It provided the following estimates at the beginning of the year as well as the following information for Jobs A and B: Estimated Data Manufacturing overhead Direct labor-hours Machine-hours Job A Direct labor-hours Machine-hours Job B Direct labor-hours Machine-hours Machining $ 726,000 11,000 66,000 Machining Assembly 5 10 11 Machining 4 12 1. Manufacturing overhead applied Job A 1. Manufacturing overhead applied Job B 2. Manufacturing overhead applied Job A 2. Manufacturing overhead applied Job B Assembly $ 121,000 66,000 6,000 2 $ $ $ Assembly 3 Required: 1. If Mason Company uses a plantwide predetermined overhead rate with direct labor-hours as the allocation base, how much manufacturing overhead cost would be applied to Job A? Job B? 2. Assume Mason Company uses departmental predetermined overhead rates. The Machining Department is allocated based on machine-hours and the Assembly Department is allocated based on direct labor-hours. How much manufacturing overhead cost would be applied to Job A? Job B? Note: For Requirement 2, round your intermediate calculations and final answers to 2 decimal places. Answer is complete but not entirely correct. $ Total 15 13 Total 9 15 165 Total $ 847,000 77,000 72,000 99✔ 18.30 X 18.30
Problem 2-24 (Algo) Plantwide Versus Multiple Predetermined Overhead Rates [LO2-1, LO2-2] Mason Company has two manufacturing departments-Machining and Assembly. All of the company's manufacturing overhead costs are fixed costs. It provided the following estimates at the beginning of the year as well as the following information for Jobs A and B: Estimated Data Manufacturing overhead Direct labor-hours Machine-hours Job A Direct labor-hours Machine-hours Job B Direct labor-hours Machine-hours Machining $ 726,000 11,000 66,000 Machining Assembly 5 10 11 Machining 4 12 1. Manufacturing overhead applied Job A 1. Manufacturing overhead applied Job B 2. Manufacturing overhead applied Job A 2. Manufacturing overhead applied Job B Assembly $ 121,000 66,000 6,000 2 $ $ $ Assembly 3 Required: 1. If Mason Company uses a plantwide predetermined overhead rate with direct labor-hours as the allocation base, how much manufacturing overhead cost would be applied to Job A? Job B? 2. Assume Mason Company uses departmental predetermined overhead rates. The Machining Department is allocated based on machine-hours and the Assembly Department is allocated based on direct labor-hours. How much manufacturing overhead cost would be applied to Job A? Job B? Note: For Requirement 2, round your intermediate calculations and final answers to 2 decimal places. Answer is complete but not entirely correct. $ Total 15 13 Total 9 15 165 Total $ 847,000 77,000 72,000 99✔ 18.30 X 18.30
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter2: Job Order Costing
Section: Chapter Questions
Problem 4BE: Applying factory overhead Bergan Company estimates that total factory overhead costs will be 620,000...
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Process Costing
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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.
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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.
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Problem 2-24 (Algo) Plantwide Versus Multiple Predetermined Overhead Rates [LO2-1, LO2-2]
Mason Company has two manufacturing departments-Machining and Assembly. All of the company's manufacturing overhead costs
are fixed costs. It provided the following estimates at the beginning of the year as well as the following information for Jobs A and B:
Estimated Data
Manufacturing overhead
Direct labor-hours
Machine-hours
Job A
Direct labor-hours
Machine-hours.
Job B
Direct labor-hours
Machine-hours
Machining
$ 726,000
11,000
66,000
Machining Assembly
5
10
11
Machining
4
12
Assembly
$ 121,000
66,000
6,000
2
1. Manufacturing overhead applied Job A
1. Manufacturing overhead applied Job B
2. Manufacturing overhead applied Job A
2. Manufacturing overhead applied Job B
Assembly
5
3
Total
15
13
Total
9
15
Required:
1. If Mason Company uses a plantwide predetermined overhead rate with direct labor-hours as the allocation base, how much
manufacturing overhead cost would be applied to Job A? Job B?
2. Assume Mason Company uses departmental predetermined overhead rates. The Machining Department is allocated based on
machine-hours and the Assembly Department is allocated based on direct labor-hours. How much manufacturing overhead cost
would be applied to Job A? Job B?
Note: For Requirement 2, round your intermediate calculations and final answers to 2 decimal places.
Answer is complete but not entirely correct.
$
$
$
$
Total
$ 847,000
77,000
72,000
165
99
18.30 X
18.30 x](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2f2d8308-4617-4f9f-b9aa-7267aedefe16%2F4f835cbe-336f-404b-9eba-b133299bcaff%2F2geen1_processed.jpeg&w=3840&q=75)
Transcribed Image Text:ts
Problem 2-24 (Algo) Plantwide Versus Multiple Predetermined Overhead Rates [LO2-1, LO2-2]
Mason Company has two manufacturing departments-Machining and Assembly. All of the company's manufacturing overhead costs
are fixed costs. It provided the following estimates at the beginning of the year as well as the following information for Jobs A and B:
Estimated Data
Manufacturing overhead
Direct labor-hours
Machine-hours
Job A
Direct labor-hours
Machine-hours.
Job B
Direct labor-hours
Machine-hours
Machining
$ 726,000
11,000
66,000
Machining Assembly
5
10
11
Machining
4
12
Assembly
$ 121,000
66,000
6,000
2
1. Manufacturing overhead applied Job A
1. Manufacturing overhead applied Job B
2. Manufacturing overhead applied Job A
2. Manufacturing overhead applied Job B
Assembly
5
3
Total
15
13
Total
9
15
Required:
1. If Mason Company uses a plantwide predetermined overhead rate with direct labor-hours as the allocation base, how much
manufacturing overhead cost would be applied to Job A? Job B?
2. Assume Mason Company uses departmental predetermined overhead rates. The Machining Department is allocated based on
machine-hours and the Assembly Department is allocated based on direct labor-hours. How much manufacturing overhead cost
would be applied to Job A? Job B?
Note: For Requirement 2, round your intermediate calculations and final answers to 2 decimal places.
Answer is complete but not entirely correct.
$
$
$
$
Total
$ 847,000
77,000
72,000
165
99
18.30 X
18.30 x
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Step 1: Introduction to predetermined overhead rate
VIEWStep 2: Calculation of plantwide predetermined overhead rate
VIEWStep 3: Allocation of overhead cost based on plantwide predetermined overhead rate
VIEWStep 4: Calculating departmental predetermined overhead rates
VIEWStep 5: Allocation of manufacturing overhead based on departmental overhead rate
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