Tancredi Corporation has two manufacturing departments--Machining and Customizing. The company used the following data at the beginning of theyear to calculate predetermined overhead rates:Estimated total machine-hours (MHS)Estimated total fixed manufacturing overhead costEstimated variable manufacturing overhead cost per MHDirect materialsDirect labor costMachining machine-hoursCustomizing machine-hoursDuring the most recent month, the company started and completed two jobs-Job E and Job J. There were no beginning inventories. Data concerningthose two jobs follow:DATELL MaterialsDirect labor costMachining machine-hoursCustomizing machine-hoursMultiple ChoiceAssume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. If both jobs are sold during themonth, the company's cost of goods sold for the month would be closest to:Note: Round your intermediate calculations to 2 decimal places.OO$102,600$61,450Job E$ 12,800$ 17,6003,4002,000$41,150$110,80812,000$ 17,600Job J$ 7,000$ 7,7001,6003,0003,4002,000Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. If both jobs are sold during themonth, the company's cost of goods sold for the month would be closest to:Note: Round your intermediate calculations to 2 decimal places.Machining Customizing5,000$ 11,500$ 3.005,000$ 22,000$ 1.80$1,000$ 7,7001,6003,000Total10,000$ 33,500

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Description: Tancredi Corporation has two manufacturing departments--Machining and Customizing. The company used the following data at the beginning of theyear to calculate predetermined overhead rates:Estimated total machine-hours (MHS)Estimated total fixed man

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Tancredi Corporation has two manufacturing departments-Machining and Customizing. The company used the following data at the beginning of the year to calculate predetermined overhead rates: Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH Direct materials Direct labor cost Machining machine-hours Customizing machine-hours During the most recent month, the company started and completed two jobs-Job E and Job J. There were no beginning inventories. Data concerning those two jobs follow: Job E $ 12,800 $ 17,600 3,400 2,000 Machining Customizing 5,000 $ 22,000 5,000 $ 11,500 $ 3.00 $ 1.80 Job J $ 7,000 $ 7,700 1,600 3,000 Total 10,000 $ 33,500 Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. If both jobs are sold during the month, the company's cost of goods sold for the month would be closest to: Note: Round your intermediate calculations to 2 decimal places.

Tancredi Corporation has two manufacturing departments-Machining and Customizing. The company used the following data at the beginning of the year to calculate predetermined overhead rates: Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH Direct materials Direct labor cost Machining machine-hours Customizing machine-hours During the most recent month, the company started and completed two jobs-Job E and Job J. There were no beginning inventories. Data concerning those two jobs follow: Job E $ 12,800 $ 17,600 3,400 2,000 Machining Customizing 5,000 $ 22,000 5,000 $ 11,500 $ 3.00 $ 1.80 Job J $ 7,000 $ 7,700 1,600 3,000 Total 10,000 $ 33,500 Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours. If both jobs are sold during the month, the company's cost of goods sold for the month would be closest to: Note: Round your intermediate calculations to 2 decimal places.

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter4: Accounting For Factory Overhead

Section: Chapter Questions

Problem 14P: Abbey Products Company is studying the results of applying factory overhead to production. The...

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Abbey Products Company is studying the results of applying factory overhead to production. The following data have been used: estimated factory overhead, 60,000; estimated materials costs, 50,000; estimated direct labor costs, 60,000; estimated direct labor hours, 10,000; estimated machine hours, 20,000; work in process at the beginning of the month, none. The actual factory overhead incurred for November was 80,000, and the production statistics on November 30 are as follows: Required: 1. Compute the predetermined rate, based on the following: a. Direct labor cost b. Direct labor hours c. Machine hours 2. Using each of the methods, compute the estimated total cost of each job at the end of the month. 3. Determine the under-or overapplied factory overhead, in total, at the end of the month under each of the methods. 4. Which method would you recommend? Why?
Kokomo Kayak Inc. uses the process cost system. The following data, taken from the organizations books, reflect the results of manufacturing operations during the month of March: Production Costs Work in process, beginning of period: Costs incurred during month: Production Data: 18,000 units finished and transferred to stockroom. Work in process, end of period, 3,000 units, two-thirds completed. Required: Prepare a cost of production summary for March.
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?
Lansing. Inc., provided the following data for its two producing departments: Machine hours are used to assign the overhead of the Molding Department, and direct labor hours are used to assign the overhead of the Polishing Department. There are 30,000 units of Form A produced and sold and 50,000 of Form B. Required: 1. Calculate the overhead rates for each department. 2. Using departmental rates, assign overhead to live two products and calculate the overhead cost per unit. How does this compare with the plantwide rate unit cost, using direct labor hours? 3. What if the machine hours in Molding were 1,200 for Form A and 3,800 for Form B and the direct labor hours used in Polishing were 5,000 and 15,000, respectively? Calculate the overhead cost per unit for each product using departmental rates, and compare with the plantwide rate unit costs calculated in Requirement 2. What can you conclude from this outcome?
Dublin Brewing Co. uses the process cost system. The following data, taken from the organizations books, reflect the results of manufacturing operations during October: Production Costs Work in process, beginning of period: Costs incurred during month: Production Data: 13,000 units finished and transferred to stockroom Work in process, end of period, 2,000 units one-half completed Required: Prepare a cost of production summary for October.
Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500 machine hours. The cost to make Job 416 is $95 in neon, 15 hours of labor at $13 per hour, and five machine hours. During the month, it incurs $95 in indirect material cost, $130 in administrative labor, $320 in utilities, and $350 in depreciation expense. What is the predetermined overhead rate if machine hours are considered the cost driver? What is the cost of Job 416? What is the overhead incurred during the month?
San Mateo Optics, Inc., specializes in manufacturing lenses for large telescopes and cameras used in space exploration. As the specifications for the lenses are determined by the customer and vary considerably, the company uses a job-order costing system. Manufacturing overhead is applied to jobs on the basis of direct labor hours, utilizing the absorption- or full-costing method. San Mateos predetermined overhead rates for 20x1 and 20x2 were based on the following estimates. Jim Cimino, San Mateos controller, would like to use variable (direct) costing for internal reporting purposes as he believes statements prepared using variable costing are more appropriate for making product decisions. In order to explain the benefits of variable costing to the other members of San Mateos management team, Cimino plans to convert the companys income statement from absorption costing to variable costing. He has gathered the following information for this purpose, along with a copy of San Mateos 20x1 and 20x2 comparative income statement. San Mateo Optics, Inc. Comparative Income Statement For the Years 20x1 and 20x2 San Mateos actual manufacturing data for the two years are as follows: The companys actual inventory balances were as follows: For both years, all administrative expenses were fixed, while a portion of the selling expenses resulting from an 8 percent commission on net sales was variable. San Mateo reports any over-or underapplied overhead as an adjustment to the cost of goods sold. Required: 1. For the year ended December 31, 20x2, prepare the revised income statement for San Mateo Optics, Inc., utilizing the variable-costing method. Be sure to include the contribution margin on the revised income statement. 2. Describe two advantages of using variable costing rather than absorption costing. (CMA adapted)
Chester Company provided information on overhead for its three producing departments as follows: Overhead is applied on the basis of machine hours in Fabricating and direct labor hours in Assembly and in Finishing. Job #13-198 had total prime cost of 6,700. The job took 40 machine hours in Fabricating, 100 direct labor hours in Assembly, and 20 direct labor hours in Finishing. What is the total cost of Job# 13-198? a. 6,700.00 b. 1,523.20 c. 8,223.20 d. 7,383.20
The following information, taken from the books of Herman Brothers Manufacturing represents the operations for January: The job cost system is used, and the February cost sheet for Job M45 shows the following: The following actual information was accumulated during February: Required: 1. Using the January data, ascertain the predetermined factory overhead rates to be used during February, based on the following: a. Direct labor cost b. Direct labor hours c. Machine hours 2. Prepare a schedule showing the total production cost of Job M45 under each method of applying factory overhead. 3. Prepare the entries to record the following for February operations: a. The liability for total factory overhead. b. Distribution of factory overhead to the departments. c. Application of factory overhead to the work in process in each department, using direct labor hours. (Use the predetermined rate calculated in Requirement 1.) d. Closing of the applied factory overhead accounts. e. Recording under- and overapplied factory overhead and closing the actual factory overhead accounts.
Baxter Company has two processing departments: Assembly and Finishing. A predetermined overhead rate of 10 per DLH is used to assign overhead to production. The company experienced the following operating activity for April: a. Materials issued to Assembly, 24,000 b. Direct labor cost: Assembly, 500 hours at 9.20 per hour; Finishing, 400 hours at 8 per hour c. Overhead applied to production d. Goods transferred to Finishing, 32,500 e. Goods transferred to finished goods warehouse, 20,500 f. Actual overhead incurred, 10,000 Required: 1. Prepare the required journal entries for the preceding transactions. 2. Assuming Assembly and Finishing have no beginning work-in-process inventories, determine the cost of each departments ending work-in-process inventories.
The records of Burris Inc. reflect the following data: Work in process, beginning of month2,000 units one-half completed at a cost of 1,250 for materials, 675 for labor, and 950 for overhead. Production costs for the monthmaterials, 99,150; labor, 54,925; factory overhead, 75,050. Units completed and transferred to stock38,500. Work in process, end of month3,000 units, one-half completed. Compute the months unit cost for each element of manufacturing cost and the total per unit cost.
Channel Products Inc. uses the job order cost system of accounting. The following is a list of the jobs completed during March, showing the charges for materials issued to production and for direct labor. Assume that factory overhead is applied on the basis of direct labor costs and that the predetermined rate is 200%. Required: Compute the amount of overhead to be added to the cost of each job completed during the month. Compute the total cost of each job completed during the month. Compute the total cost of producing all the jobs finished during the month.