Ahlhelm Corporation has two production departments, Forming and Assembly. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Forming Department's predetermined overhead rate is based on machine- hours and the Assembly Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machine-hours Direct labor-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour During the current month the company started and finished Job T924. The following data were recorded for this job Job T924: Machine-hours Direct labor-hours Direct materials. Direct labor cost Multiple Choice O $55.200 O O $385 $840 The estimated total manufacturing overhead for the Assembly Department is closest to: O $27,000 $47700 Forming 70 30 $82.200 $870 $630 Forming Assembly 16,000 2,000 Assembly 20 40 15,000 6,000 $ $ 55,200 102,400 $ 2.30 $ 4.50

Ahlhelm Corporation has two production departments, Forming and Assembly. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Forming Department's predetermined overhead rate is based on machine- hours and the Assembly Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machine-hours Direct labor-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour During the current month the company started and finished Job T924. The following data were recorded for this job Job T924: Machine-hours Direct labor-hours Direct materials. Direct labor cost Multiple Choice O $55.200 O O $385 $840 The estimated total manufacturing overhead for the Assembly Department is closest to: O $27,000 $47700 Forming 70 30 $82.200 $870 $630 Forming Assembly 16,000 2,000 Assembly 20 40 15,000 6,000 $ $ 55,200 102,400 $ 2.30 $ 4.50

Name: Ahlhelm Corporation has two production departments, Forming and Assem
Uploaded: 2024-03-20T06:33:06.000Z
Channel: Bartleby
Description: Ahlhelm Corporation has two production departments, Forming and Assembly. The company uses a Job-order costing system and computes a predetermined overhead rate in each production department. The Forming Department's predetermined overhead rate is b

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter6: Process Costing

Section: Chapter Questions

Problem 24E: Baxter Company has two processing departments: Assembly and Finishing. A predetermined overhead rate...

See similar textbooks

Related questions

Q: Comans Corporation has two production departments, Milling and Customizing. The company uses a…

A: Fixed manufacturing overhead cost of Customizing Department = $64,400 Number of direct labor hours…

Q: Mahon Corporation has two production departments, Casting and Customizing. The company uses a…

A: Applied overhead is recorded as a kind of direct overhead charge in the cost-accounting technique.…

Q: ulla Corporation has two production departments, Machining and Customizing. The company uses a…

A: In this question, we have to calculate total overhead applied .

Q: Comans Corporation has two production departments, Milling and Customizing. The company uses a…

A: Cost accounting is broadly used by the management in order to make great business decisions. Under…

Q: Bulla Corporation has two production departments, Machining and Customizing. The company uses a…

A: The predetermined overhead rate is calculated as estimated overhead cost divided by estimated base…

Q: Fatzinger Corporation has two production departments, Milling and Assembly. The company uses a…

A: Predetermined Overhead Rate: Predetermined overhead rate is a measure used to allocate the estimated…

Q: Columbo Corporation has two production departments, Forming and Finishing. The company uses a…

A: Job order costing is a method of costing the product. This method is used when the product…

Q: Eisentrout Corporation has two production departments, Machining and Customizing. The company uses a…

A: The job order costing is the costing system that determines the total cost related to each job. This…

Q: Deloria Corporation has two production departments, Forming and Assembly. The company uses a…

A: Total Variable manufacturing overhead for Assembly Department = Variable manufacturing overhead per…

Q: Kalp Corporation has two production departments, Machining and Finishing. The company uses a…

A: Predetermined overhead rate for Fixed Manufacturing overhead = Fixed Manufacturing overhead costs /…

Q: Tiff Corporation has two production departments, Casting and Assembly. The company uses a job-order…

A: The objective of the question is to calculate the overhead applied in the Assembly Department to Job…

Q: Comans Corporation has two production departments, Milling and Customizing. The company uses a…

A: Particulars Milling Customizing Basis of Allocation Machine Direct Labour Total Fixed Overhead…

Q: Reed Corporation has two production departments, Machining and Finishing. The company uses a…

A: The Numerical has covered the concept of Predetermined Overhead and Computation of Total Cost for a…

Q: Mahon Corporation has two production departments, Casting and Customizing. The company uses a…

A: Predetermined Overhead Rate :— It is the rate used to allocate manufacturing overhead cost to cost…

Q: Collini Corporation has two production departments, Machining and Customizing. The company uses a…

A: Selling price is the price at which product is to be sold. The mark-up is the margin. Here, in the…

Q: Deloria Corporation has two production departments, Forming and Assembly. The company uses a…

A: PREDETERMINED OVERHEAD RATEPredetermined rate means the indirect cost rate.Predetermined overhead…

Q: XYZ has two production departments, Forming and Finishing. The company uses a job-order costing…

A: The cost of a particular job for which the finished goods are produced is determined using the…

Q: Orange Corporation has two production departments, Milling and Customizing. The company uses a…

A: Cost accounting is broadly used by the management in order to make great business decisions. Under…

Q: Kalp Corporation has two production departments, Machining and Finishing. The company uses a…

A: Particulars Machining Finishing Machine Hours 19000 12000 Direct labor hour 2000 8000 Fixed…

Q: Frame Corporation has two production departments, Casting and Customizing. The company uses a…

A: The estimated total manufacturing overhead cost for department comprises variable and fixed…

Q: Ahlheim Corporation has two production departments, Forming and Assembly. The company uses a…

A: Computation of the amount of overhead applied in both department is as follows:

Q: Mahon Corporation has two production departments, Casting and Customizing. The company uses a…

A: Predetermined Overhead Rate:— It is the rate used to allocate manufacturing overhead cost to cost…

Q: Comans Corporation has two production departments, Milling and Customizing. The company uses a…

A: Introduction: Manufacturing costs are the costs incurred during the production process of a company.…

Q: the company marks up its manufacturing costs by 10% then the selling price for Job A319 would be…

A: Calculation of overhead rates Fixed manufacturing overhead rate (Milling department) = Fixed…

Q: Garza Corporation has two production departments, Casting and Customizing. The company uses a…

A: The overhead is applied to the production on the basis of the predetermined overhead rate. The…

Q: Comans Corporation has two production departments, Milling and Customizing. The company uses a…

A: Overhead applied is the amount of estimated overhead. It can be determined using the predetermined…

Q: Deloria Corporation has two production departments, Forming and Assembly. The company uses a…

A: Selling price is the price at which a commodity is sold and it includes the cost incurred to make…

Concept explainers

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.

Topic Video

Question

Ahlhelm Corporation has two production departments, Forming and Assembly. The company uses a Job-order costing system and computes a predetermined overhead rate in each production department. The Forming Department's predetermined overhead rate is based on machine-
hours and the Assembly Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates:
Machine-hours
Direct labor-hours
Total fixed manufacturing overhead cost
Variable manufacturing overhead per machine-hour
Variable manufacturing overhead per direct labor-hour
During the current month the company started and finished Job T924. The following data were recorded for this Job:
Job T924:
Machine-hours
Direct labor-hours
Direct materials
Direct labor cost
Multiple Choice
$55,200
$27,000
The estimated total manufacturing overhead for the Assembly Department is closest to:
$47,700
Forming
70
30
$870
$630
$82,200
Assembly
20
40
Forming Assembly
16,000
15,000
2,000
6,000
$ 55,200
$
102,400
$ 2.30
$385
$840
$ 4.50

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Manufacturing overhead :

VIEW

Step 2: Calculation of the estimated total manufacturing overhead for assembly department :

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Lansing. Inc., provided the following data for its two producing departments: Machine hours are used to assign the overhead of the Molding Department, and direct labor hours are used to assign the overhead of the Polishing Department. There are 30,000 units of Form A produced and sold and 50,000 of Form B. Required: 1. Calculate the overhead rates for each department. 2. Using departmental rates, assign overhead to live two products and calculate the overhead cost per unit. How does this compare with the plantwide rate unit cost, using direct labor hours? 3. What if the machine hours in Molding were 1,200 for Form A and 3,800 for Form B and the direct labor hours used in Polishing were 5,000 and 15,000, respectively? Calculate the overhead cost per unit for each product using departmental rates, and compare with the plantwide rate unit costs calculated in Requirement 2. What can you conclude from this outcome?
A company has the following information relating to its production costs: Compute the actual and applied overhead using the companys predetermined overhead rate of $23.92 per machine hour. Was the overhead over applied or under applied, and by how much?
Channel Products Inc. uses the job order cost system of accounting. The following is a list of the jobs completed during March, showing the charges for materials issued to production and for direct labor. Assume that factory overhead is applied on the basis of direct labor costs and that the predetermined rate is 200%. Required: Compute the amount of overhead to be added to the cost of each job completed during the month. Compute the total cost of each job completed during the month. Compute the total cost of producing all the jobs finished during the month.
A manufacturing company has two service and two production departments. Building Maintenance and Factory Office are the service departments. The production departments are Assembly and Machining. The following data have been estimated for next years operations: The direct charges identified with each of the departments are as follows: The building maintenance department services all departments of the company, and its costs are allocated using floor space occupied, while factory office costs are allocable to Assembly and Machining on the basis of direct labor hours. 1. Distribute the service department costs, using the direct method. 2. Distribute the service department costs, using the sequential distribution method, with the department servicing the greatest number of other departments distributed first.
Rockford Company has four departmental accounts: Building Maintenance, General Factory Overhead, Machining, and Assembly. The direct labor hour method is used to apply factory overhead to the jobs being worked on in Machining and Assembly. The company expects each production department to use 30,000 direct labor hours during the year. The estimated overhead rates for the year include the following: During the year, both Machining and Assembly used 28,000 direct labor hours. Factory overhead costs incurred during the year follow: In determining application rates at the beginning of the year, cost allocations were made as follows, using the sequential distribution method: Building Maintenance to: General Factory Overhead, 10%; Machining, 50%; Assembly, 40%. General factory overhead was distributed according to direct labor hours. Required: Determine the under- or overapplied overhead for each production department. (Hint: First you must distribute the service department costs.)
The following data appeared in the accounting records of Craig Manufacturing Inc., which uses the weighted average cost method: Case 1All materials are added at the beginning of the process, and labor and factory overhead are added evenly throughout the process. Case 2One-half of the materials are added at the start of the manufacturing process, and the balance of the materials is added when the units are one-half completed. Labor and factory overhead are applied evenly during the process. Make the following computations for each case: a. Unit cost of materials, labor, and factory overhead for the month b. Cost of the units finished and transferred during the month c. Cost of the units in process at the end of the month
The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning February 1 would be 3,150,000, and total direct labor costs would be 1,800,000. During February, the actual direct labor cost totalled 160,000, and factory overhead cost incurred totaled 283,900. a. What is the predetermined factory overhead rate based on direct labor cost? b. Journalize the entry to apply factory overhead to production for February. c. What is the February 28 balance of the account Factory OverheadBlending Department? d. Does the balance in part (c) represent over- or underapplied factory overhead?
Gerken Fabrication Inc. uses the job order cost system of accounting. The following information was taken from the companys books after all posting had been completed at the end of March: a. Compute the total production cost of each job. b. Prepare the journal entries to charge the costs of materials, labor, and factory overhead to Work in Process. c. Prepare the journal entry to transfer the cost of jobs completed to Finished Goods. d. Compute the unit cost of each job. e. Compute the selling price per unit for each job, assuming a mark-on percentage of 50%.
Geneva, Inc., makes two products, X and Y, that require allocation of indirect manufacturing costs. The following data were compiled by the accountants before making any allocations: The total cost of purchasing and receiving parts used in manufacturing is 60,000. The company uses a job-costing system with a single indirect cost rate. Under this system, allocated costs were 48,000 and 12,000 for X and Y, respectively. If an activity-based system is used, what would be the allocated costs for each product?
The following information, taken from the books of Herman Brothers Manufacturing represents the operations for January: The job cost system is used, and the February cost sheet for Job M45 shows the following: The following actual information was accumulated during February: Required: 1. Using the January data, ascertain the predetermined factory overhead rates to be used during February, based on the following: a. Direct labor cost b. Direct labor hours c. Machine hours 2. Prepare a schedule showing the total production cost of Job M45 under each method of applying factory overhead. 3. Prepare the entries to record the following for February operations: a. The liability for total factory overhead. b. Distribution of factory overhead to the departments. c. Application of factory overhead to the work in process in each department, using direct labor hours. (Use the predetermined rate calculated in Requirement 1.) d. Closing of the applied factory overhead accounts. e. Recording under- and overapplied factory overhead and closing the actual factory overhead accounts.
Determining job costcalculation of predetermined rate for applying overhead by direct labor cost and direct labor hour methods Beemer Products Inc. has its factory divided into three departments, with individual factory overhead rates for each department. In each department, all the operations are sufficiently alike for the department to be regarded as a cost center. The estimated monthly factory overhead for the departments is as follows: Forming, 64,000; Shaping, 36,000; and Finishing, 10,080. The estimated production data include the following: The job cost ledger shows the following data for X6, which was completed during the month: Required: Determine the cost of X6. Assume that the factory overhead is applied to production orders, based on the following: 1. Direct labor cost 2. Direct labor hours (Hint: You must first determine overhead rates for each department, rounding rates to the nearest cent.)
Chester Company provided information on overhead for its three producing departments as follows: Overhead is applied on the basis of machine hours in Fabricating and direct labor hours in Assembly and in Finishing. Job #13-198 had total prime cost of 6,700. The job took 40 machine hours in Fabricating, 100 direct labor hours in Assembly, and 20 direct labor hours in Finishing. What is the total cost of Job# 13-198? a. 6,700.00 b. 1,523.20 c. 8,223.20 d. 7,383.20