Banc Corporation Trust is considering either a bank-wide overhead rate or department overhead rates to allocate $396,000 of indirect costs. The bank-wide rate could be based on eitherdirect labor-hours (DLH) or the number of loans processed. The departmental rates would be based on direct labor-hours for Consumer Loans and a dual rate based on direct labor-hours andthe number of loans processed for Commercial Loans. The following information was gathered for the upcoming period:DepartmentConsumerDLH16,0009,000LoansProcessedDirectCosts700300$ 280,000$ 180,000CommercialIf Banc Corporation Trust uses a bank-wide rate based on the number of loans processed, what would be the total costs for the Consumer Department?Multiple ChoiceО$254,000О$280,000OO$576,000$557,200< Prev11 of 23Next >GA

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Answered: Banc Corporation Trust is considering…

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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Macalister Corporation is developing departmental overhead rates based on direct labor hours for its two production departments—Molding and Assembly. The Molding Department employs 20 people, and the Assembly Department employs 80 people. Each person in these two departments works 2,000 hours per year. The production-related overhead costs for the Molding Department are budgeted at $190,000, and the Assembly Department costs are budgeted at $80,000. Two support departments—Engineering and General Factory—directly support the two production departments and have budgeted costs of $216,000 and $370,000, respectively. The production departments' overhead rates cannot be determined until the support departments' costs are properly allocated. The following schedule reflects the use of the Engineering Department's and General Factory Department's output by the various departments. Engineering General Factory Molding Assembly Engineering hours — 2,000 2,000 8,000 Square feet…
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Rose Company uses a flexible budget for manufacturing overhead based on direct labor hours. The following information are from the yearly static overhead budget for the Production Department for 2023. It is based on 300,000 direct labor hours. Variable Costs Fixed Costs Indirect labor ($1.2 per DL hour) $30,000 Supervision $ 5,000 Supplies and lubricants ($0.5 per DL hour) 12,500 Depreciation 2,000 Maintenance ($0,7 per DL hour) 17,500 Property taxes 1,500 Utilities ($0,4 per DL hour) 10,000 Insurance 1,000 During July, 24,500 direct labor hours were worked. The company incurred the following variable costs in July: indirect labor $30,200, supplies and lubricants $11,600, maintenance $17,500, and utilities $9,200. Actual fixed overhead costs were the same as monthly budgeted fixed costs. a.) Prepare a flexible monthly budget for the Production Department for the relevant range between 24,000 and 26,000 DL hours with increments of 1000 DL hours. b.) Prepare a flexible budget…
Banc Corporation Trust is considering either a bank-wide overhead rate or department overhead rates to allocate $396,000 of indirect costs. The bank-wide rate could be based on either direct labor-hours (DLH) or the number of loans processed. The departmental rates would be based on direct labor-hours for Consumer Loans and a dual rate based on direct labor-hours and the number of loans processed for Commercial Loans. The following information was gathered for the upcoming period: Department DLH Loans Processed Direct Costs Consumer 14,000 700 $ 280,000 Commercial 8,000 300 $ 180,000 If Banc Corporation Trust uses a bank-wide rate based on the number of loans processed, what would be the total costs for the Consumer Department? Multiple Choice $280,000 $256,800 $576,000 $557,200
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Banc Corporation Trust is considering either a bank-wide overhead rate or department overhead rates to allocate $398,000 of indirect costs. The bank-wide rate could be based on either direct labor-hours (DLH) or the number of loans processed. The departmental rates would be based on direct labor-hours for Consumer Loans and a dual rate based on direct labor-hours and the number of loans processed for Commercial Loans. The following information was gathered for the upcoming period: Department Consumer Commercial Multiple Choice O How much of the $398,000 indirect costs should be allocated to the Consumer Department, if Banc Corporation Trust uses a bank-wide rate based on the number of loans processed? Note: Round the bank-wide rate to the nearest dollar. O O $298,000 $298.500 $290,000 DLH 18,000 6,000 $108,000 Loans Processed 750 250 Direct Costs $ 290,000 $ 170,000
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