Desert Products uses a job-costing system with two direct-cost categories (direct materials and direct manufacturing labor) and one manufacturing overhead cost pool. Desert allocates manufacturing overhead costs using direct manufacturing labor costs. Desert provides the following information: (Click the icon to view the information.) Read the requirements Requirement 1. Compute the actual and budgeted manufacturing overhead rates for 2017. (Enter your answer as a number [not as a percentage] rounded to two decimal places, X.XX.) Actual manufacturing overhead rate - X Budgeted manufacturing overhead rate Data Table Requirements Budget for 2017 Actual Results for 2017 Direct material costs 2,100,000 $ 2,050,000 1. Compute the actual and budgeted manufacturing overhead rates for 2017. 2. During March, the job-cost record for Job 626 contained the following information: Direct manufacturing labor costs 1,500,000 1,460,000 Direct materials used Manufacturing overhead costs 2,775,000 2,920,000 $50,000 $30,000 Direct manufacturing labor costs Compute the cost of Job 626 using (a) actual costing and (b) normal costing. 3. At the end of 2017, compute the under- or overallocated manufacturing overhead under normal costing. Why is there no under- or overallocated overhead under actual costing? 4. Why might managers at Desert Products prefer to use normal costing? Print Done
Desert Products uses a job-costing system with two direct-cost categories (direct materials and direct manufacturing labor) and one manufacturing overhead cost pool. Desert allocates manufacturing overhead costs using direct manufacturing labor costs. Desert provides the following information: (Click the icon to view the information.) Read the requirements Requirement 1. Compute the actual and budgeted manufacturing overhead rates for 2017. (Enter your answer as a number [not as a percentage] rounded to two decimal places, X.XX.) Actual manufacturing overhead rate - X Budgeted manufacturing overhead rate Data Table Requirements Budget for 2017 Actual Results for 2017 Direct material costs 2,100,000 $ 2,050,000 1. Compute the actual and budgeted manufacturing overhead rates for 2017. 2. During March, the job-cost record for Job 626 contained the following information: Direct manufacturing labor costs 1,500,000 1,460,000 Direct materials used Manufacturing overhead costs 2,775,000 2,920,000 $50,000 $30,000 Direct manufacturing labor costs Compute the cost of Job 626 using (a) actual costing and (b) normal costing. 3. At the end of 2017, compute the under- or overallocated manufacturing overhead under normal costing. Why is there no under- or overallocated overhead under actual costing? 4. Why might managers at Desert Products prefer to use normal costing? Print Done
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Desert Products uses a job-costing system with two direct-cost categories (direct materials and direct manufacturing labor) and one manufacturing overhead cost pool. Desert allocates manufacturing overhead costs using direct manufacturing labor costs.
Desert provides the following information:
E (Click the icon to view the information.)
Read the requirements
...
Requirement 1. Compute the actual and budgeted manufacturing overhead rates for 2017. (Enter your answer as a number [not as a percentage] rounded to two decimal places, X.XX.)
Actual manufacturing overhead rate
Budgeted manufacturing overhead rate
Data Table
Requirements
Budget for 2017
Actual Results for 2017
Direct material costs
2,100,000 $
2.050,000
1. Compute the actual and budgeted manufacturing overhead rates for 2017.
2. During March, the job-cost record for Job 626 contained the following information:
Direct manufacturing labor costs
1,500,000
1,460,000
Direct materials used
$50,000
Manufacturing overhead costs
2,775,000
2.920,000
Direct manufacturing labor costs
$30.000
Compute the cost of Job 626 using (a) actual costing and (b) normal costing.
3. At the end of 2017, compute the under- or overallocated manufacturing overhead
under normal costing. Why is there no under- or overallocated overhead under actual
costing?
4. Why might managers at Desert Products prefer to use normal costing?
Print
Done
Print
Done](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F959f46f1-4efc-4020-8c0e-3fb24bcb27ed%2Fc2f8db5e-0c1a-4f49-9a95-73d1f8121bd1%2Fp56xsqu_processed.png&w=3840&q=75)
Transcribed Image Text:Desert Products uses a job-costing system with two direct-cost categories (direct materials and direct manufacturing labor) and one manufacturing overhead cost pool. Desert allocates manufacturing overhead costs using direct manufacturing labor costs.
Desert provides the following information:
E (Click the icon to view the information.)
Read the requirements
...
Requirement 1. Compute the actual and budgeted manufacturing overhead rates for 2017. (Enter your answer as a number [not as a percentage] rounded to two decimal places, X.XX.)
Actual manufacturing overhead rate
Budgeted manufacturing overhead rate
Data Table
Requirements
Budget for 2017
Actual Results for 2017
Direct material costs
2,100,000 $
2.050,000
1. Compute the actual and budgeted manufacturing overhead rates for 2017.
2. During March, the job-cost record for Job 626 contained the following information:
Direct manufacturing labor costs
1,500,000
1,460,000
Direct materials used
$50,000
Manufacturing overhead costs
2,775,000
2.920,000
Direct manufacturing labor costs
$30.000
Compute the cost of Job 626 using (a) actual costing and (b) normal costing.
3. At the end of 2017, compute the under- or overallocated manufacturing overhead
under normal costing. Why is there no under- or overallocated overhead under actual
costing?
4. Why might managers at Desert Products prefer to use normal costing?
Print
Done
Print
Done
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