Baehr Company is a manufacturing company with a fiscal year that runs from July 1 to June 30. The company uses a job-order accounting system for its production costs. A predetermined overhead rate based upon direct labor hours is used to apply overhead to individual jobs. A flexible budget of overhead costs was prepared for the fiscal year as shown below. Direct labor hours 100,000 120,000 140,000         Variable overhead costs $325,000 $390,000 $455,000 Fixed overhead costs 216,000 216,000 216,000         Total overhead $541,000 $606,000 $671,000         Although the annual ideal capacity is 150,000 direct labor hours, company officials have determined 120,000 direct labor hours to be normal capacity for the year. The information presented below is for November. Jobs 83-50 and 83-51 were completed during November. Inventories November 1:   Raw materials and supplies $  10,500 Work-in-process (Job 83-50) 54,000 Finished goods 112,500     Purchases of raw materials and supplies: Raw materials $135,000 Supplies 15,000       $150,000       Materials and supplies requisitioned for production: Job 83-50 $  45,000   Job 83-51 37,500   Job 83-52 25,500   Supplies 12,000           $120,000         Factory direct labor hours:   Job 83-50 3,500 Job 83-51 3,000 Job 83-52 2,000       8,500       Labor costs for people working in the factory:   Direct labor wages $51,000 Indirect labor wages (4,000 hours) 15,000 Plant manager salary 6,000       $72,000     Building occupancy costs (heat, light, depreciation, etc.):   Factory facilities $6,500 Sales offices 1,500 Administrative offices 1,000       $9,000       Factory equipment costs:   Power $4,000 Repairs and maintenance 1,500 Depreciation 1,500 Other 1,000       $8,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Topic Video
Question

Baehr Company is a manufacturing company with a fiscal year that runs from July 1 to June 30. The company uses a job-order accounting system for its production costs. A predetermined overhead rate based upon direct labor hours is used to apply overhead to individual jobs. A flexible budget of overhead costs was prepared for the fiscal year as shown below.

Direct labor hours

100,000

120,000

140,000

 
 
 
 

Variable overhead costs

$325,000

$390,000

$455,000

Fixed overhead costs

216,000

216,000

216,000

 
 
 
 

Total overhead

$541,000

$606,000

$671,000

 

 

 

 

Although the annual ideal capacity is 150,000 direct labor hours, company officials have determined 120,000 direct labor hours to be normal capacity for the year.

The information presented below is for November. Jobs 83-50 and 83-51 were completed during November.

Inventories November 1:

 

Raw materials and supplies

$  10,500

Work-in-process (Job 83-50)

54,000

Finished goods

112,500

   

Purchases of raw materials and supplies:

Raw materials

$135,000

Supplies

15,000

 
 
 

$150,000

   
 

Materials and supplies requisitioned for production:

Job 83-50

$  45,000

 

Job 83-51

37,500

 

Job 83-52

25,500

 

Supplies

12,000

 
 
 
 

 

$120,000

 
 
 
 

Factory direct labor hours:

 

Job 83-50

3,500

Job 83-51

3,000

Job 83-52

2,000

 
 

 

8,500

 
 
 

Labor costs for people working in the factory:

 

Direct labor wages

$51,000

Indirect labor wages (4,000 hours)

15,000

Plant manager salary

6,000

 
 
 

$72,000

 
 

Building occupancy costs (heat, light,

depreciation, etc.):

 

Factory facilities

$6,500

Sales offices

1,500

Administrative offices

1,000

 
 

 

$9,000

 
 
 

Factory equipment costs:

 

Power

$4,000

Repairs and maintenance

1,500

Depreciation

1,500

Other

1,000

 
 

 

$8,000

 
 

 

Actual manufacturing overhead incurred during November was __________?

Assume the predetermined overhead rate is $4.50 per direct labor hour. The total cost of Job 83-50 is __________ ?

Assume Baehr’s predetermined overhead rate is $4.50 per direct labor hour. The total amount of overhead applied to jobs during November was _____________?

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps

Blurred answer
Knowledge Booster
Performance measurements
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
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education