Angsa Mas Sdn.Bhd. uses a job-order cost system and applied manufacturing overhead cost to jobs on the basis of the cost of direct materials used in production. At the beginning of the year 2021, the following estimates were made for the purpose of computing the predetermined overhead rate: RM300,000; and direct material cost, RM240,000. At the beginning of the year 2021, the balance in the inventory accounts were as follows: Raw materials RM18,000 Work in process RM24,000 Finished Goods RM35,000 During the year of 2021, the following transactions took place (all purchases and services were acquired are on account): a. Raw material purchased, RM242,000. b. Raw materials requisitioned for use in production (all direct material), RM250,000. c. Factory utilities incurred, RM31,000. d. Costs for salaries and wages were incurred as follows: Direct labor RM216,000 Indirect labor RM100,000 Selling and administrative salaries RM145,000 e. Maintenance cost incurred in the factory, RM25,000. f. Advertising costs incurred, RM80,000. g. Depreciation recorded for the year, RM50,000 (80% relates to factory assets , and the remainder relates to selling and administrative assets). h. Rental cost incurred on building, RM90,000 (70% of the space is occupied by the factory, and 30% is occupied by sales and administrative). i. Others selling and administrative expenses incurred, RM25,000. j. Manufacturing overhead cost was applied to jobs, RM____. k. Cost of goods manufactured for the year, RM740,000. l. Sales for the year (all on account) totaled RM1,000,000. These goods cost RM600,000 to manufacture according to their job cost sheets. Question : a) Compute the predetermine overhead rate
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.
Angsa Mas Sdn.Bhd. uses a job-order cost system and applied
to jobs on the basis of the cost of direct materials used in production. At the beginning of the
year 2021, the following estimates were made for the purpose of computing the
predetermined overhead rate: RM300,000; and direct material cost, RM240,000.
At the beginning of the year 2021, the balance in the inventory accounts were as follows:
Raw materials RM18,000
Work in process RM24,000
Finished Goods RM35,000
During the year of 2021, the following transactions took place (all purchases and services
were acquired are on account):
a. Raw material purchased, RM242,000.
b. Raw materials requisitioned for use in production (all direct material), RM250,000.
c. Factory utilities incurred, RM31,000.
d. Costs for salaries and wages were incurred as follows:
Direct labor RM216,000
Indirect labor RM100,000
Selling and administrative salaries RM145,000
e. Maintenance cost incurred in the factory, RM25,000.
f. Advertising costs incurred, RM80,000.
g.
, and the remainder relates to selling and administrative assets).
h. Rental cost incurred on building, RM90,000 (70% of the space is occupied by the
factory, and 30% is occupied by sales and administrative).
i. Others selling and administrative expenses incurred, RM25,000.
j. Manufacturing overhead cost was applied to jobs, RM____.
k. Cost of goods manufactured for the year, RM740,000.
l. Sales for the year (all on account) totaled RM1,000,000. These goods cost RM600,000
to manufacture according to their
Question :
a) Compute the predetermine overhead rate
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