A company allocates overhead using a standard overhead rate of $4.80 per direct labor hour and 2 direct labor hours per unit. For this period, the company planned production of 10,140 units (80% of its capacity) and budgeted $36,504 in variable overhead and $62,800 in fixed overhead. The company actually produced 11,600 units this period and incurred actual total overhead costs of $116,430. Enter answers in the tabs below. Required 1 Required 2 Required 3 Compute the overhead volume variance. Note: For each variance, select favorable, unfavorable, or no variance. Do not round intermediate calculations. Volume variance Volume Variance < Required 2 Required 3 >

A company allocates overhead using a standard overhead rate of $4.80 per direct labor hour and 2 direct labor hours per unit. For this period, the company planned production of 10,140 units (80% of its capacity) and budgeted $36,504 in variable overhead and $62,800 in fixed overhead. The company actually produced 11,600 units this period and incurred actual total overhead costs of $116,430. Enter answers in the tabs below. Required 1 Required 2 Required 3 Compute the overhead volume variance. Note: For each variance, select favorable, unfavorable, or no variance. Do not round intermediate calculations. Volume variance Volume Variance < Required 2 Required 3 >

Name: Chs 18-25A company allocates overhead using a standard overhead rate
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Description: Chs 18-25A company allocates overhead using a standard overhead rate of $4.80 per direct labor hour and 2 direct labor hoursper unit. For this period, the company planned production of 10,140 units (80% of its capacity) and budgeted $36,504 invariab

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 12E

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(Appendix 4A) Overhead Application, Journal Entries, Job Cost At the beginning of the year, Smith Company budgeted overhead of 129,600 as well as 13,500 direct labor hours. During the year, Job K456 was completed with the following information: direct materials cost, 2,750; direct labor cost, 5,355. The average wage for Smith Company employees is 17 per hour. By the end of the year, 18,100 direct labor hours had actually been worked, and Smith incurred the following actual overhead costs for the year: Required: 1. Calculate the overhead rate for the year. 2. Calculate the total cost of Job K456. 3. Prepare the journal entries to record actual overhead and to apply overhead to production for the year. 4. Is overhead overapplied or underapplied? By how much? 5. Assuming that the normal cost of goods sold for the year is 635,600, what is the adjusted cost of goods sold?
A company estimates its manufacturing overhead will be $840,000 for the next year. What is the predetermined overhead rate given each of the following Independent allocation bases? Budgeted direct labor hours: 90,615 Budgeted direct labor expense: $750000 Estimated machine hours: 150,000
Data for the past two years for Behavior Corp. are: 20A 20B Units produced 10,000 11,000 Overhead applied per unit P15 P15 Actual overhead: Fixed 50,000 55,000 Variable 95,000 150,000 Estimated overhead: Fixed 50,000 56,000 Variable 130,000 142,000 The company determines overhead rates based on estimated units to be produced. Required: Determine the estimated units of production used to obtain the overhead allocation rates in 20A and 20B. Determine the over- or underapplied factory overhead for each of the two years.
Underapplied and Overapplied Overhead Osborn Manufacturing uses a predetermined overhead rate of $18.20 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $218,400 of total manufacturing overhead for an estimated activity level of 12,000 direct labor-hours. The company actually incurred $215,000 of manufacturing overhead and 11,500 direct labor-hours during the period. Required: 1. Determine the amount of underapplied or overapplied manufacturing overhead for the period. 2. Assume that the company’s underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the journal entry to dispose of the underapplied or overapplied overhead increase or decrease the company’s gross margin? By how much?
Crosshill Company's total overhead costs at various levels of activity are presented below: Month Machine- Hours Total Overhead Cost April 70,000 $ 202,200 May 60,000 $ 180,300 June 80,000 $ 224,100 July 90,000 $ 246,000 Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 60,000-machine-hour level of activity in May is as follows: Utilities (variable) $ 52,200 Supervisory salaries (fixed) 21,000 Maintenance (mixed) 107,100 Total overhead cost $ 180,300 The company wants to break down the maintenance cost into its variable and fixed cost elements. Required: 1. Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint: To do this, first determine how much of the $246,000 consisted of utilities and supervisory salaries. Think about the behaviour of variable and fixed costs within the relevant range.) (Round the "Variable cost per unit" to 2 decimal places.) 2. Using the high-low…
P4-14 Determining the under- and overapplied overhead Ko-Be Corporation has four departmental accounts: Building Maintenance, General Factory Overhead, Machining, and As- sembly. The direct labor hour method is used to apply factory overhead to the jobs being worked on in Machining and Assem- bly. The company expects each production department to use 30,000 direct labor hours during the year. The estimated over- head rates for the year include the following: Machining Assembly Variable cost per hour $1.30 $1.50 Fixed cost per hour 2.70 3.00 $4.00 $4.50 During the year, both Machining and Assembly used 28,000 direct labor hours. Factory overhead costs incurred during the year follow: Building maintenance $30,000 ..... General factory overhead 75,400 Machining 45,800 ... ... Assembly 68,800 .... ..
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Underapplied overhead analysis Tyler Company applies manufacturing overhead to production at the rate of $4 per direct labor hour and ended August with $12,000 underapplied overhead. Actual manufacturing overhead incurred for August amounted to $88,000.Required:How many direct labor hours did Tyler Company incur during August?
Applying Factory Overhead Carrothers Company estimates that total factory overhead costs will be $210,000 for the year. Direct labor hours are estimated to be 14,000. a. For Carrothers Company, determine the predetermined factory overhead rate using direct labor hours as the activity base. per direct labor hour b. During August, Carrothers Company accumulated 760 hours of direct labor costs on Job 50 and 740 hours on Job 56. Determine the amount of factory overhead applied to Jobs 50 and 56 in August. c. Journalize the entry to apply factory overhead to both jobs in August according to the predetermined overhead rate. If an amount box does not require an entry, leave it blank.
iven a predetermined overhead rate of $1.60 per direct labor hour, a capacity of 50,000 hours and 42,000 actual hours, the cost of unused capacity is
Overhead is charged at a normal rate of P2.50 per direct labor hour. The actual operations for the month of October are summarized as follows: 1. Purchase of raw material, 25,000 pieces @ P1.20/piece 2. Material and labor costs charged to production: Job No. Units Material Direct labor cost Direct labor hours 001 10,000 P4,000 P6,000 3,000 002 8,800 3,600 5,400 2,700 003 16,000 7,000 9,000 4,500 004 8,000 3,200 4,800 2,400 005 20,000 8,000 3,600 1,800 1. Actual overhead costs inccured during October amounted to P33,500 2. Completed jobs: 001, 002, 003, and 004 3. Sales for a month of October amounted to P105,000. All units produced on Jobs 101, 102, and 103 were sold. How much is the over-applied overhead for October?
Crosshill Company’s total overhead costs at various levels of activity are presented below: Month Machine-Hours Total Overhead Cost April 70,000 $ 205,000 May 60,000 $ 184,500 June 80,000 $ 225,500 July 90,000 $ 246,000 Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 60,000-machine-hour level of activity in May is as follows: Utilities (variable) $ 52,800 Supervisory salaries (fixed) 21,000 Maintenance (mixed) 110,700 Total overhead cost $ 184,500 The company wants to break down the maintenance cost into its variable and fixed cost elements. Required: 1. Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint: To do this, first determine how much of the $246,000 consisted of utilities and supervisory salaries. Think about the behaviour of variable and fixed costs within the relevant range.) (Round the "Variable…