Managerial Accounting for Managers
4th Edition
ISBN: 9781259578540
Author: Eric Noreen, Peter C. Brewer Professor, Ray H Garrison
Publisher: McGraw-Hill Education
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Chapter 4, Problem 4.14E
To determine
Concept Introduction:
Predetermined overhead allocation:
Manufacturing overhead cost is the pool of all indirect costs incurred for the production. These are the costs that are not directly traceable to the product.
To calculate: The overhead cost to be added to the job.
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21. Ethel Corp. Has the following data for the year 2021:Estimated FOHP40.000 + (P 2X Mhr)Estimated machine hours5.000Assume that Ethel Corp. Has work on three jobs: 01; 02; and 03 last year. 1,500machine hours were spent for job 01; 2,000 machine hours for job 02; and 1,700machine hours for job 03. The actual factory overhead is P56,000 using 5,200machine hours.What is the total under or over applied Factory Overhead?
Assume that the defective goods were charged to all jobs, what is the cost transferred to finish goods at the end of the year?
342,000
335,000
349,740
342,500
5.
Agora Company uses a predetermined overhead rate based on machine hours to apply manufacturing overhead to jobs. The company has provided the following estimated costs for next year:
Direct materials
$10,000
Direct labour
$30,000
Sales commissions
$40,000
Salary of production supervisor
$20,000
Indirect materials
$4,000
Advertising expense
$8,000
Rent of factory equipment
$10,000
Agora estimates that 10,000 machine hours will be worked during the year. The predetermined overhead rate per machine hour will be?
$9.00
$6.80
$6.40
$3.40
$8.20
Chapter 4 Solutions
Managerial Accounting for Managers
Ch. 4 - Why arent actual manufacturing overhead costs...Ch. 4 - What is the purpose of the job cost sheet in a...Ch. 4 - Prob. 4.3QCh. 4 - Prob. 4.4QCh. 4 - Prob. 4.5QCh. 4 - Prob. 4.6QCh. 4 - Prob. 4.7QCh. 4 - Prob. 4.8QCh. 4 - Prob. 4.9QCh. 4 - Prob. 4.10Q
Ch. 4 - Prob. 4.11QCh. 4 - Prob. 4.12QCh. 4 - Prob. 4.13QCh. 4 - Prob. 4.14QCh. 4 - Compute the Predetermined Overhead Rate [LO4-1]...Ch. 4 - Prob. 4.2ECh. 4 - Prob. 4.3ECh. 4 - Prob. 4.4ECh. 4 - Direct Method of Determining cost of Goods sold...Ch. 4 - Prob. 4.6ECh. 4 - Prob. 4.7ECh. 4 - Computing predetermined overhead Rates and 00b...Ch. 4 - Departmental Overhead Rates [LO4-1, LO4-2, LO4-3]...Ch. 4 - Prob. 4.10ECh. 4 - Prob. 4.11ECh. 4 - Applying overhead; cost of Goods Manufactured...Ch. 4 - Prob. 4.13ECh. 4 - Prob. 4.14E
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- Assume that the defective goods were charged to all jobs, what is the cost transferred to finish goods at the end of the year? A. 342,000 B. 335,000 C. 349,740 D. 342,500arrow_forward1. How much manufacturing overhead was incurred during the year? Is manufacturing overhead underallocated or overallocated at the end of the year? By how much? 2. Were the jobs overcosted or undercosted? By how much? Manufacturing overhead costs. . . . . . $630,000 Direct labor cost. . . . . . . . . . . . . . . . . . $1,550,000 Machine hours. . . . . . . . . . . . . . . . . . . . 90,000 At the end of the year, the company had actually incurred the following: Direct labor cost. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,220,000 Depreciation on manufacturing plant and equipment. . . . $500,000 Property taxes on plant. . . . . . . . . . . . . . . . . . . . . . . . . . $21,000 Sales salaries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25,000 Delivery drivers' wages. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $17,000 Plant janitors'…arrow_forwardEthel Corp. Has the following data for the year 2021: Estimated FOH P40,000 + (P 2X Mhr) Estimated machine hours 5,000 Assume that Ethel Corp. Has work on three jobs: 01; 02; and 03 last year. 1,500 machine hours were spent for job 01; 2,000 machine hours for job 02; and 1,700 machine hours for job 03. The actual factory overhead is P56,000 using 5,200 machine hours. What is the predetermined FOH? What is the expected FOH for an actual level of activity of 5,200 machine hours? What is the Factory Overhead applied to Job 03? What is the total under or over applied Factory Overhead?arrow_forward
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