64) Hill Manufacturing uses departmental cost driver rates to apply manufacturing overhead costs to products. Manufacturing overhead costs are applied on the basis of machine hours in the Machining Department and on the basis of direct labour hours in th Assembly Department. The following estimates were provided at the beginning of the current year: Machining 10,000 dlh 100,000 mh $80,000 Manufacturing overhead costs $250,000 Direct labour hours Machine hours Direct labour cost Assembly 90,000 dlh 5,000 mh $720,000 $360,000 The accounting records of the company show the following data for Job #846: Machining 50 dlh 170 mh Assembly 120 dlh 10 mh Direct labour hours Machine hours Direct material cost Direct labour cost $2,700 $400 $1,600 $900 Required: a. Compute the manufacturing indirect cost allocation rate for each department. b. Compute the total cost of Job #846.

64) Hill Manufacturing uses departmental cost driver rates to apply manufacturing overhead costs to products. Manufacturing overhead costs are applied on the basis of machine hours in the Machining Department and on the basis of direct labour hours in th Assembly Department. The following estimates were provided at the beginning of the current year: Machining 10,000 dlh 100,000 mh $80,000 Manufacturing overhead costs $250,000 Direct labour hours Machine hours Direct labour cost Assembly 90,000 dlh 5,000 mh $720,000 $360,000 The accounting records of the company show the following data for Job #846: Machining 50 dlh 170 mh Assembly 120 dlh 10 mh Direct labour hours Machine hours Direct material cost Direct labour cost $2,700 $400 $1,600 $900 Required: a. Compute the manufacturing indirect cost allocation rate for each department. b. Compute the total cost of Job #846.

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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The following cost data relate to the manufacturing activities of Newberry Company during the just completed year: Total actual manufacturing OH costs incurred (including 15,000 of indirect materials) 353,000 Purchases of raw materials (both direct and Indirect) 250,000 Direct labor cost 135,000 Raw Materials, beg 10,000 Raw Materials, end 15,000 Work in Process, beg 20,000 Work in process, end 35,000 The company uses a predetermined overhead rate to apply manufacturing overhead cost to production. The predetermined overhead rate for the year was $15 per machine-hour. A total of 23,000 machine-hours were recorded for the year. Required: Compute the amount of underapplied or overapplied manufacturing overhead cost for the year.
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