Introduction To Managerial Accounting
8th Edition
ISBN: 9781259917066
Author: BREWER, Peter C., Garrison, Ray H., Noreen, Eric W.
Publisher: Mcgraw-hill Education,
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Chapter 2, Problem 10E
To determine
Plant wide
Requirement1:
The Plant-wide pre-determined overhead rate of the service industry need to be determined.
Requirement2:
To determine
The
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Chapter 2 Solutions
Introduction To Managerial Accounting
Ch. 2 - What is job-order costing?Ch. 2 - What is absorption costing?Ch. 2 - What is normal costing?Ch. 2 - How is the unit product cost of a job calculated?Ch. 2 - Explain the four-step process used to compute a...Ch. 2 - What is the purpose of the job cost sheet in a...Ch. 2 - Explain why some production costs must be assigned...Ch. 2 - Why do companies use predetermined overhead rates...Ch. 2 - What factors should be considered in selecting an...Ch. 2 - If a company fully allocates all of its overhead...
Ch. 2 - Prob. 11QCh. 2 - What is underapplied overhead? Overapplied...Ch. 2 - What is a plantwide overhead rate? Why are...Ch. 2 - This Excel worksheet relates to the Dickson...Ch. 2 - This Excel worksheet relates to the Dickson...Ch. 2 - This Excel worksheet relates to the Dickson...Ch. 2 - This Excel worksheet relates to the Dickson...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Sweeten Company bad no jobs in progress at the...Ch. 2 - Harris Fabrics computes its plantwide...Ch. 2 - Luthan Company uses a plant wide predetermined...Ch. 2 - Computing Total Job Costs and Unit Product Costs...Ch. 2 - Computing Total Job Costs and Unit Product Costs...Ch. 2 - Braverman Company has two manufacturing...Ch. 2 - Job-Order Costing for a Service Company Tech...Ch. 2 - Prob. 7ECh. 2 - Newhard Company assigns overhead cost to jobs on...Ch. 2 - Taveras Corporation is currently operating at 50%...Ch. 2 - Prob. 10ECh. 2 - Varying Plantwide Predetermined Overhead Rates...Ch. 2 - Computing Predetermined Overhead Rates and Job...Ch. 2 - Departmental Predetermined Overhead Rates White...Ch. 2 - Prob. 14ECh. 2 - Plantwide and Departmental Predetermined Overhead...Ch. 2 - Plantwide Predetermined Overhead Rates; Pricing...Ch. 2 - Plantwide and Departmental Predetermined Overhead...Ch. 2 - Job-Order Costing for a Service Company Speedy...Ch. 2 - Multiple Predetermined Overhead Rates; Applying...Ch. 2 - Plantwide versus Multiple Predetermined Overhead...Ch. 2 - Plantwide versus Multiple Predetermined Overhead...
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- Queen Bees Honey, Inc., estimated its annual overhead to be $110,000 and based its predetermined overhead rate on 27,500 direct labor hours. At the end of the year, actual overhead was $106,000 and the total direct labor hours were 29,000. What is the entry to dispose of the over applied or under applied overhead?arrow_forwardChannel 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.arrow_forwardRulers 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?arrow_forward
- Coops Stoops estimated its annual overhead to be $85,000 and based its predetermined overhead rate on 24,286 direct labor hours. At the end of the year, actual overhead was $90,000 and the total direct labor hours were 24,100. What is the entry to dispose of the over applied or under applied overhead?arrow_forwardYork 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?arrow_forwardDuring the month, Job Arch2 used specialized machinery for 350 hours and incurred $700 in utilities on account. $400 in factory depreciation expense, and $200 in property tax on the factory. Prepare journal entries for the following: A. Record the expenses incurred. B. Record the allocation of overhead at the predetermined rate of $1.50 per machine hour.arrow_forward
- Luna Manufacturing Inc. completed Job 2525 on May 31, and there were no jobs in process in the plant. Prior to June 1, the predetermined overhead application rate for June was computed from the following data, based on an estimate of 5,000 direct labor hours: The factory has one production department and uses the direct labor hour method to apply factory overhead. Three jobs are started during the month, and postings are made daily to the job cost sheets from the materials requisitions and labor-time records. The following schedule shows the jobs and amounts posted to the job cost sheets: The factory overhead control account was debited during the month for actual factory overhead expenses of 27,000. On June 11, Job 2526 was completed and delivered to the customer using a mark-on percentage of 50% on manufacturing cost. On June 24, Job 2527 was completed and transferred to Finished Goods. On June 30, Job 2528 was still in process. Required: 1. Prepare job cost sheets for Jobs 2526, 2527, and 2528, including factory overhead applied when the job was completed or at the end of the month for partially completed jobs. 2. Prepare journal entries as of June 30 for the following: a. Applying factory overhead to production. b. Closing the applied factory overhead account. c. Closing the factory overhead account. d. Transferring the cost of the completed jobs to finished goods. e. Recording the cost of the sale and the sale of Job 2526.arrow_forwardK company production was working on Job 1 and Job 2 during the month. Of the $780 in direct materials. $375 in materials was requested for Job 1. Direct labor cost, including payroll taxes, are $23 per hour, and employees worked 18 hours on Job 1 and 29 hours on Job 2. Overhead is applied at the rate of $20 per direct labor hours. Prepare job order cost sheets for each job.arrow_forwardAbbey 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?arrow_forward
- 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?arrow_forwardDuring August, Skyler Company worked on three jobs. Data relating to these three jobs follow: Overhead is assigned on the basis of direct labor hours at a rate of 2.30 per direct labor hour. During August, Jobs 39 and 40 were completed and transferred to Finished Goods Inventory. Job 40 was sold by the end of the month. Job 41 was the only unfinished job at the end of the month. Required: 1. Calculate the per-unit cost of Jobs 39 and 40. (Round unit costs to nearest cent.) 2. Compute the ending balance in the work-in-process inventory account. 3. Prepare the journal entries reflecting the completion of Jobs 39 and 40 and the sale of Job 40. The selling price is 140 percent of cost.arrow_forwardCollegiate Publishing Inc. began printing operations on March 1. Jobs 301 and 302 were completed during the month, and all costs applicable to them were recorded on the related cost sheets. Jobs 303 and 304 are still in process at the end of the month, and all applicable costs except factory overhead have been recorded on the related cost sheets. In addition to the materials and labor charged directly to the jobs, 4,500 of indirect materials and 8,200 of indirect labor were used during the month. The cost sheets for the four jobs entering production during the month are as follows, in summary form: Journalize the summary entry to record each of the following operations for March (one entry for each operation): a. Direct and indirect materials used. b. Direct and indirect labor used. c. Factory overhead applied to all four jobs (a single overhead rate is used based on direct labor cost). d. Completion of Jobs 301 and 302.arrow_forward
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