Wehner Company is currently manufacturing Part ABS-43, producing 59,800 units annually. The part is used in the production of several products made by Wehner. Thecost per unit for ABS-43 is as follows:Direct materialsDirect laborVariable overheadFixed overhead$47.659.502.453.55$63.15Totalof the total fixed overhead assigned to ABS-43, $15,010 is direct fixed overhead (the annual lease cost of machinery used to manufacture Part ABS-43), and theremainder is common fixed overhead. An outside supplier has offered to sell the part to Wehner for $59.46. There is no alternative use for the facilities currently used toproduce the part. No significant non-unit-based overhead costs are incurred.Required:1. Should Wehner Company make or buy Part ABS-437Wehner shouldthe part. This will produce total cost savings of s2. What is the maximum amount per unit that Wehner would be willing to pay to an outside supplier? Round your answer to the nearest centper unit

Answer : Particular Make Buy Direct material $47.65 Direct labor 9.50 Variable…

Answered: 010 is direct fixed overhead (the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Makkah Equipment Co. sells machines and has the following information for the year. Actual Estimated Overhead cost OMR 2,400,000 OMR 3,000,000 Direct labor hours 120,000 300,000 Machine hours 300,000 150,000 Overhead is applied on the basis of machine hours. The amount of over or under-applied overhead is: Select one: O a. 300N00 Overapplied b. None of the answers are correct O c. 300,000 Underapplied d. 260,000 Underapplied e. 150,000 Underapplied
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In January 2023, Spartans Inc. allocated $30,700 and manufacturing overhead to job 167. in December when actual cost were known the actual amount for job 167 was $32,750. Overhead was ( overapplied-under applied- or correctly applied) by ( $3400-$1750-$2450-$0-$2050-$3800-$1550)
On September 1, 20x1, ABC Co. enters into a contract with a customer to remodel a plant's electrical wirings and install a new generator for a total consideration of P10M. The remodeling and the installation single performance obligation treated as a satisfied over time. The expected contract costs Generator LO as follows: Other costs Expected total contract costs 2,500,000 4,000,000 6,500,000 VERSITY Additional information: • ABC Co. uses the cost-to-cost method in measuring its progress towards the complete satisfaction of the performance obligation. • ABC Co. incurs total costs of P4,000,000 in 20x1, including the cost of the generator. The customer obtains control of the generator when it is delivered to the site in December 20x1. However, the generator will not be installed until March 20x2. • • ABC Co. regards the cost of the generator as significant in relation to the expected total contract costs-eating during examinations, quizzes or plagiarism in connection . Although ABC Co.…
Berkeley Inc. is engaged in manufacturing. For the procurement of machines, Berkeley Inc. uses the leasing method. On May 1, 2016, Berkeley Inc. entered into a lease contract with Mindy Corp. on a printing machine that costs Rp180,000,000 with the following agreement:- The lease period is 3 years, payments are made semi-annually with the first payment is November 1, 2016.- The lease payment per 6 months is Rp35,000,000,-.- Berkeley Inc. has the option to purchase the production machine at a price of Rp1,500,000,- at the end of the lease period- The economic life of the production machine is 5 years- The incremental borrowing rate is 15%- Mindy Corp's implicit interest rate is 12%, known to Berkeley Inc. Prepare the schedule of lease payment! (Use the following format)
Required information [The following information applies to the questions displayed below.) Watercraft's predetermined overhead rate is 200% of direct labor. Information on the company's production activities during May follows. a. Purchased raw materials on credit, $220,000. b. Materials requisitions record use of the following materials for the month. Job 136 Job 137 Job 138 Job 139 Job 140 Total direct materials Indirect materials $ 49,500 34,000 20,000 22,800 6,400 132,700 20,500 Total materials requisitions $ 153,200 c. Time tickets record use of the following labor for the month. These wages were paid in cash. Job 136 Job 137 $ 12,100 Job 138 Job 139 Job 140 Total direct labor Indirect labor Total labor cost 10,700 37,900 39,000 4,000 103,700 26,500 $ 130,200 d. Applied overhead to Jobs 136, 138, and 139. e. Transferred Jobs 136, 138, and 139 to Finished Goods Inventory. f. Sold Jobs 136 and 138 on credit at a total price of $540,000. g. Recorded the cost of goods sold for Jobs…
Rhone-Metro Industries manufactures equipment that is sold or leased. On December 31, 2024, Rhone-Metro leased equipment to Western Soya Company for a noncancelable stated lease term of four years ending December 31, 2028, at which time possession of the leased asset will revert back to Rhone-Metro. ● ● ● The equipment cost $390,000 to manufacture and has an expected useful life of six years. Its normal sales price is $445,205. The expected residual value of $26,000 on December 31, 2028, is not guaranteed. The first payment was made on December 31, 2024. Western Soya's incremental borrowing rate is 10%. Western Soya knows the interest rate implicit in the lease payments is 9%. Both companies use straight-line depreciation or amortization. [Hint: A lease term ends for accounting purposes when an option becomes exercisable if it's expected to be exercised (i.e., a BPO).] Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of…
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What if the company actually spent $95,000 on overhead costs? What causes a company to have overapplied or underapplied overhead? Is this a situation that would eventually need to be resolved? If so, how?

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010 is direct fixed overhead (the annual lease cost of machinery used to man plier has offered to sell the part to Wehner for $59.46. There is no alternativ head costs are incurred.