WUIKS UH three jobs during the upcoming year.Direct labor-hours recorded by job are: job 237, 7,000 hours; job 250.30,000 hours; and job 239, 21.000 hours. How much overhead cost willthe company apply to Work in Process for the year? If actual costs areP420,000 for the year, will overhead be underapplied or overapplied? byhow much?Exercise 4 (Departmental Overhead Rates)Bobcat Company has two departments, milling and assembly. The companyuses a job-order cost system and computes a predetermined overhead rate ineach department. The milling department bases its rate on machine-hours, andthe assembly department bases its rate on direct labor cost. At the beginningof the year, the company made the following estimates:DepartmentMilling8,00060,000P510,00072,000AssemblyDirect labor-hours75,0003,000P800,000640,000Machine-hoursManufacturing overhead costDirect labor costRequired:1. Compute the predetermined overhead rate to be used in each department.2. Assume that the overhead rates you computed in (1) above are in effect.The job cost sheet for job 123, which was stated and completed during theyear, showed the following:DepartmentMillingAssemblyDirect labor-hours20904Machine-hoursP800P370Materials requisitionedDirect labor cost45160Compute the total overhead cost applied to job 123.3. Would you expect substantially different amounts of overhead cost to becharged to some jobs if the company used a plantwide overhead rate basedon direct labor cost instead of using departmental rates? Explain. Nocomputations are necessary.

Job costing includes the aggregation of the expenses of materials, overhead and labor for a…

Bobcat Company has two departments, milling and assembly. The company uses a job-order cost system and computes a predetermined overhead rate in each department. The milling department bases its rate on machine-hours, and the assembly department bases its rate on direct labor cost. At the beginning of the year, the company made the following estimates: Department Milling 8,000 60,000 P510,000 P800,000 72,000 Assembly 75,000 3,000 Direct labor-hours Machine-hours Manufacturing overhead cost Direct labor cost 640,000 Required: 1. Compute the predetermined overhead rate to be used in each department. 2. Assume that the overhead rates you computed in (1) above are in effect. The job cost sheet for job 123, which was stated and completed during the year, showed the following: Department Assembly 20 Milling Direct labor-hours Machine-hours 90 Materials requisitioned P800 P370 Direct labor cost 45 160 Compute the total overhead cost applied to job 123. 3. Would you expect substantially different amounts of overhead cost to be charged to some jobs if the company used a plantwide overhead rate based on direct labor cost instead of using departmental rates? Explain. No computations are necessary.

Bobcat Company has two departments, milling and assembly. The company uses a job-order cost system and computes a predetermined overhead rate in each department. The milling department bases its rate on machine-hours, and the assembly department bases its rate on direct labor cost. At the beginning of the year, the company made the following estimates: Department Milling 8,000 60,000 P510,000 P800,000 72,000 Assembly 75,000 3,000 Direct labor-hours Machine-hours Manufacturing overhead cost Direct labor cost 640,000 Required: 1. Compute the predetermined overhead rate to be used in each department. 2. Assume that the overhead rates you computed in (1) above are in effect. The job cost sheet for job 123, which was stated and completed during the year, showed the following: Department Assembly 20 Milling Direct labor-hours Machine-hours 90 Materials requisitioned P800 P370 Direct labor cost 45 160 Compute the total overhead cost applied to job 123. 3. Would you expect substantially different amounts of overhead cost to be charged to some jobs if the company used a plantwide overhead rate based on direct labor cost instead of using departmental rates? Explain. No computations are necessary.

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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