1.
Concept introduction:
Direct labor cost: The direct labor cost costs refer to the total cost incurred by the company for paying the wages and other benefits to the company’s employees against the work performed by them.
To calculate: The total estimated direct labor cost for each quarter of the coming fiscal year and the year.
2.
Concept introduction:
Direct labor cost: The direct labor cost costs refer to the total cost incurred by the company for paying the wages and other benefits to the company’s employees against the work performed by them.
Manufacturing overhead cost: Manufacturing overhead is also called factory overhead. It is the total cost involved in operating all production facilities of a manufacturing business that cannot be traced directly to a product.
To calculate: The total estimated manufacturing overhead cost for each quarter of the coming fiscal year and for the year.
3.
Concept introduction:
Direct labor cost: The direct labor cost costs refer to the total cost incurred by the company for paying the wages and other benefits to the company’s employees against the work performed by them.
Manufacturing overhead cost: Manufacturing overhead is also called factory overhead. It is the total cost involved in operating all production facilities of a manufacturing business that cannot be traced directly to a product.
To calculate: The cash payments for manufacturing overhead costs for each quarter of the coming fiscal year and the year.
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MANAGERIAL ACCT W/ACCESS
- Refer to Exercise 8.27. At the end of the year, Meliore, Inc., actually produced 310,000 units of the standard model and 115,000 of the deluxe model. The actual overhead costs incurred were: Required: Prepare a performance report for the period. In an attempt to improve budgeting, the controller for Meliore, Inc., has developed a flexible budget for overhead costs. Meliore, Inc., makes two types of products, the standard model and the deluxe model. Meliore expects to produce 300,000 units of the standard model and 120,000 units of the deluxe model during the coming year. The standard model requires 0.05 direct labor hour per unit, and the deluxe model requires 0.08. The controller has developed the following cost formulas for each of the four overhead items: Required: 1. Prepare an overhead budget for the expected activity level for the coming year. 2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products) and a budget for production that is 20 percent lower than expected.arrow_forward8 Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows. Indirect labor Indirect materials Utilities Fixed overhead costs per month are Supervision $3,500, Depreciation $1,300, and Property Taxes $700. The company believes it will normally operate in a range of 5,500-8,500 direct labor hours per month. Variable Costs Indirect labor $1.20 Assume that in July 2020, Myers Company incurs the following manufacturing overhead costs. Indirect materials Utilities 0.80 0.40 Depreciation $8,720 Supervision 5,830 Depreciation 2,590 Property taxes Direct Labor Hours Fixed Costs Indirect Labor Indirect Materials Property Taxes Supervision Fixed Costs Total Costs Total Fixed Costs Total Variable Costs Utilities Variable Costs (a) Prepare a flexible budget performance report, assuming that the company worked 7,500 direct labor hours during the month. (List variable costs before fixed…arrow_forwardExercise 8-15 (Algo) Direct Labor and Manufacturing Overhead Budgets (LO8-5, L08-6) The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year Ist Quarter 11,700 2nd Quarter 10,700 Jed Quarter 12,700 Units to be produced Each unit requires 0.25 direct labor-hours and direct laborers are paid $15.00 per hour In addition, the variable manufacturing overhead rate is $180 per direct labor hour. The fixed manofacturing overhead is $97,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $37,000 per quarter Total direct labor cost 13,700 Required: 1. Calculate the company's total estimated direct labor cost for each quarter of the upcoming fiscal year and for the year as a whole. 2. and 3. Calculate the company's total estimated manufacturing overhead cost and the cash disbursements for manufacturing overhead for each quarter of the upcoming fiscal year and for…arrow_forward
- Exercise 8-15 (Algo) Direct Labor and Manufacturing Overhead Budgets [LO8-5, LO8-6] The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Units to be produced 10,800 9,800 11,800 12,800 Each unit requires 0.25 direct labor-hours and direct laborers are paid $13.00 per hour. In addition, the variable manufacturing overhead rate is $1.90 per direct labor-hour. The fixed manufacturing overhead is $88,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $28,000 per quarter. Required: 1. Calculate the company’s total estimated direct labor cost for each quarter of the the upcoming fiscal year and for the year as a whole. 2&3. Calculate the company’s total estimated manufacturing overhead cost and the cash disbursements for manufacturing overhead for each quarter of the upcoming fiscal…arrow_forwardEXERCISE 8-15 Direct Labor and Manufacturing Overhead Budgets LO8-5, LO8-6 The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: Units to be produced. 2. 1st Quarter 3. 12,000 2nd Quarter 3rd Quarter 10,000 13,000 Each unit requires 0.2 direct labor-hours and direct laborers are paid $12.00 per hour. In addition, the variable manufacturing overhead rate is $1.75 per direct labor-hour. The fixed manufacturing overhead is $86,000 per quarter. The only noncash element of manufacturing over- head is depreciation, which is $23,000 per quarter. Required: 1. 4th Quarter 14,000 Calculate the company's total estimated direct labor cost for each quarter of the the upcom- ing fiscal year and for the year as a whole. Assume that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the estimated number of units produced (Hint: Refer to Schedule 4 for…arrow_forward3 The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 10,400 8,000 8,200 10,500 Each unit requires 0.35 direct labor-hours, and direct laborers are paid $14.00 per hour. Units to be produced Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost 1st Quarter Rordan Corporation Direct Labor Budget 2nd Quarter 3rd Quarter 4th Quarter Yeararrow_forward
- Direct Labor and Manufacturing Overhead Budgets The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: Each unit requires 0.2 direct labor-hours and direct laborers are paid $12.00 per hour. In addition, the variable manufacturing overhead rate is $1.75 per direct labor-hour. The fixed manufacturing overhead is $86,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $23,000 per quarter. Required: 1. Calculate the company’s total estimated direct labor cost for each quarter of the the upcoming fiscal year and for the year as a whole. Assume that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the estimated number of units produced (Hint: Refer to Schedule 4 for guidance). 2. Calculate the company’s total estimated manufacturing overhead cost for each quarter of the Upcoming fiscal year and for the…arrow_forwardEXERCISE 8-15 Direct Labor and Manufacturing Overhead Budgets [ LO8-5, Q LO8-6] The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Units to be produced 12,000 10,000 13,000 14,000 Each unit regquires 0.2 direct labor-hours and direct laborers are paid $12.00 per hour. In addition, the variable manufacturing overhead rate is $1.75 per direct labor-hour. The fixed manufacturing overhead is $86,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $23,000 per quarter. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.arrow_forwardQuestion 7 Howard Bannister Company budgets the following per-unit costs for the upcoming year: Direct Material Direct Labor Variable Selling Expenses Sales commission $32.54 $21.24 $15.70 $20.10 Howard budgets producing 1,017 units and having 27,370 of total variable overhead, 49,540 of total fixed overhead, and 30,387 of total fixed S&A costs for the year. Howard allocates overhead based on units produced. What is the per-unit cost of inventory under variable costing (i.e., assuming budgets are correct, how much will be the total amount debited to WIP if Howard produces one additional unit)? Round your answer to two decimal places (e.g., 192.37).arrow_forward
- QUESTION 8 Avery Company has compiled the following data for the upcoming year: Sales are expected to be 13300 units at $31 each. • Each unit requires 2.1 pounds of direct materials at $2.1 per pound. • Each unit requires 0.7 hours of direct labor at $14 per hour. Manufacturing overhead is $6 per unit. Selling and administrative costs are $6 per unit What is Avery's budgeted cost of goods sold? M Azarrow_forwardCh. 8 Total Budgeted Cost of Goods Sold Problem. Please solve the following problem and explain each step. S&P's direct material cost is $6.50 per unit. The direct laboer is $30 per hour and each unit takes 1/2 hour to produce. Variablel Manufacturing Overhead is $2.75 per unit and total fixed overhead is $63,000. A sales commission of $5 is paid on each unit. If S&P expects to produce 9,000 units and sell 7,000 units, the total budgeted cost of goods sold for the year is?arrow_forwardYuvwell Corporation's direct labor budget for next year contained the following information: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 11,000 9,700 10,000 10,800 Budgeted direct labor-hours The company uses direct labor-hours as its overhead allocation base. The variable portion of its predetermined manufacturing overhead rate is $5.75 per direct labor-hour and its total fixed manufacturing overhead is $78,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation of $19,500 per quarter. Required: 1. Prepare the company's manufacturing overhead budget for next year. 2. Compute the company's predetermined overhead rate (including both variable and fixed manufacturing overhead) for next year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the company's manufacturing overhead budget for next year. Note: Round "Variable manufacturing overhead rate" answers to 2 decimal places. Variable…arrow_forward
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