At what amounts would customers be billed if the company's practice was to charge 180% of the production cost of each job? Veronica Company allocates overhead costs to jobs on the basis of direct labor-hours. Itsestimated average monthly factory costs for 2005 were as follows:Average Monthly CostsDirect material cost$60,000300,000180,000Direct labor costOverhead costIts estimated average monthly direct labor-hours are 20,000. Among the jobs worked on inNovember 2005 were two jobs, G and H, for which the following information was collected:Job GJob HDirect material costDirect labor cost$10,00028,0002,400$10,00032,0002,800Direct labor-hours

Apportionment of indirect costs to produced goods on the basis of direct labor hours charged or the…

Veronica Company allocates overhead costs to jobs on the basis of direct labor-hours. Its estirnated average monthly factory costs for 2005 were as follows: Direct material cost Direct labor cost Overhead cost Average Monthly Costs $ 60,000 300,000 180,000 Its estimated average monthly direct labor-hours are 20,000. Among the jobs worked on in November 2005 were two jobs, G and H, for which the following information was collected: Job G Job H Direct material cost Direct labor cost Direct labor-hours $10,000 28,000 2,400 $10,000 32,000 2,800

Veronica Company allocates overhead costs to jobs on the basis of direct labor-hours. Its estirnated average monthly factory costs for 2005 were as follows: Direct material cost Direct labor cost Overhead cost Average Monthly Costs $ 60,000 300,000 180,000 Its estimated average monthly direct labor-hours are 20,000. Among the jobs worked on in November 2005 were two jobs, G and H, for which the following information was collected: Job G Job H Direct material cost Direct labor cost Direct labor-hours $10,000 28,000 2,400 $10,000 32,000 2,800

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 1EA: Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor...

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SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 543,000 + 1.34X, where X equals number of smokers. Last year, SmokeCity produced 20,000 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year? 4. What is the total variable overhead cost incurred by SmokeCity last year? 5. What is the overhead cost per unit produced? 6. What is the fixed overhead cost per unit? 7. What is the variable overhead cost per unit? 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,500 units and (b) 21,600 units. (Round your answers to the nearest cent.) Explain this outcome.
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?
The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning February 1 would be 3,150,000, and total direct labor costs would be 1,800,000. During February, the actual direct labor cost totalled 160,000, and factory overhead cost incurred totaled 283,900. a. What is the predetermined factory overhead rate based on direct labor cost? b. Journalize the entry to apply factory overhead to production for February. c. What is the February 28 balance of the account Factory OverheadBlending Department? d. Does the balance in part (c) represent over- or underapplied factory overhead?
Natur-Gro, Inc., manufactures composters. Based on past experience, Natur-Gro has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 264,000 + 1.42X, where X equals number of composters. Last year, Natur-Gro produced 30,000 composters. Actual overhead costs for the year were as expected. Total overhead for per unit was a. 1.42 b. 8.80 c. 11.63 d. 10.22
York Company Is a machine shop that estimated overhead will be $50,000, consisting of 5,000 hours of direct labor. The cost to make job 0325 is $70 in aluminum and two hours of labor at $20 per hour. During the month. York incurs $50 in indirect material cost. $150 in administrative labor, $300 in utilities, and $250 in depreciation expense. What is the predetermined overhead rate if direct labor hours are considered the cost driver? What is the cost of Job 0325? What is the overhead incurred during the month?
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Pocono Cement Forms expects $900,000 in overhead during the next year. It does not know whether it should apply overhead on the basis of its anticipated direct labor hours of 60,000 or its expected machine hours of 30,000. Determine the product cost under each predetermined allocation rate if the last job incurred $1,550 in direct material cost, 90 direct labor hours, and 75 machine hours. Wages are paid at $16 per hour.