Benton Corporation manufactures computer microphones, which come in two models: Standard and Premium. Data fora representative quarter for the two models follow:StandardPremiumUnits producedProduction runs per quarter11,600502,90025Direct materials cost per unit$ 3050$ 6475Direct labor cost per unitManufacturing overhead in the plant has three main functions: supervision, setup labor, and incoming materialinspection. Data on manufacturing overhead for a representative quarter follow:SupervisionSetup laborIncoming inspectionTotal overhead$ 239,250278,400200,100$ 717,750Required:a. Benton currently applies overhead on the basis of direct labor cost. What is the predetermined overhead rate for the quarter?b. The CFO and the plant controller at Benton are thinking of adopting an ABC system. They have tentatively chosen the followingcost drivers: direct labor cost for supervision, production runs for setup labor, and direct material dollars for incoming inspection.Compute the cost driver rates for the proposed system at Benton.Note: Enter your answers rounded to 2 decimal places.a. Overhead rateh Sunervision% of direct labor cost% of direct lahor onst

a. Benton currently applies overhead on the basis of direct labor cost. What is the predetermined overhead rate for the quarter? b. The CFO and the plant controller at Benton are thinking of adopting an ABC system. They have tentatively chosen the following cost drivers: direct labor cost for supervision, production runs for setup labor, and direct material dollars for incoming inspection Compute the cost driver rates for the proposed system at Benton. Note: Enter your answers rounded to 2 decimal places. a. Overhead rate h Sunervision % of direct labor cost of direct labor cost

a. Benton currently applies overhead on the basis of direct labor cost. What is the predetermined overhead rate for the quarter? b. The CFO and the plant controller at Benton are thinking of adopting an ABC system. They have tentatively chosen the following cost drivers: direct labor cost for supervision, production runs for setup labor, and direct material dollars for incoming inspection Compute the cost driver rates for the proposed system at Benton. Note: Enter your answers rounded to 2 decimal places. a. Overhead rate h Sunervision % of direct labor cost of direct labor cost

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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Oakwood Creations Company makes decorative candle pedestals. An industrial engineer consultant developed ideal time standards for one unit of the Berkley model pedestal. The standards follow, along with the cost accountant's determination of current labor pay rates: Worktype 1 Worktype 2 Worktype 3 0.18 hour @ $12.31 per hour 0.32 hour @ $10.89 per hour 0.62 hour @ $19.65 per hour Required: a. Using the preceding data, calculate the direct labor cost for a Berkley model pedestal. b. Would it be appropriate to use the cost calculated in part a as a standard cost for evaluating direct labor performance and valuing inventory? Complete this question by entering your answers in the tabs below. Required A Required B Would it be appropriate to use the cost calculated in part a as a standard cost for evaluating direct labor performance and valuing inventory? Would it be appropriate to use the cost calculated in part a as a standard cost for evaluating direct labor performance and valuing…
Using the direct method, the total amount of overhead allocated to each machine hour at NUBD Co. would be (round-off to 2 decimal places) If NUBD Co. uses the step-down method of allocating service costs beginning with quality control, the maintenance costs allocated to the Assembly Department would be If NUBD Co. uses the direct method of allocating service department costs, the total service costs allocated to the assembly department would be If NUBD Co. uses the reciprocal method of allocating service costs, the total amount of quality control costs (rounded to the nearest peso) to be allocated to the other departments would be
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Crane is an electronics components manufacturer. Information about the company's two products follows: AM-2 FM-9 Units produced 20,000 4,000 Direct labor hours required for production 10,000 15,000 Units per batch 4,000 400 Shipping weight per unit 0.50 Ibs. 10 Ibs. The company incurs $786,000 in overhead per year and has traditionally applied overhead on the basis of direct labor hours.
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Mozart Music Inc. makes three musical instruments: trumpets, tubas, and trombones. Amount Descriptions Assembly Fabrication Trombones Trumpets Tubas Total
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Since, the predetermined overhead rate and the budgeted factory overhead is given. We need to calculate the amount of the allocation base in order to know how Mystic Inc. computed its predetermined overhead rate for 2010. Equation to compute the Predetermined Overhead rate: Given: Predetermined Overhead rate = Predetermined rate: $4.25 per direct labor dollar Budgeted Factory Overhead: $1,275,000 Solution: $4.25 = ? = $300,000 = = $300,000 is the budgeted direct labor cost.
Angle Max Industries produces a product which goes through two operations, Assembly and Finishing, before it is ready to be shipped. Next year's expected costs and activities are shown below. Direct labor hours Machine hours Overhead costs Multiple Choice Assume that the Assembly Department allocates overhead using a plantwide overhead rate based on machine hours. How much total overhead will be assigned to a product that requires 2 direct labor hour and 3.30 machine hours in the Assembly Department, and 4.50 direct labor hours and 0.4 machine hours in the Finishing Department? O$17.60. Assembly 180,000 DLH 380,000 MH $380,000 $20.40. Finishing 148,000 DLH 91, 200 MH $562, 400
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