Predetermined Factory Overhead RateRoad Runner Engine Shop uses a job order cost system to determine the cost of performing engine repair work. Estimated costs and expensesfor the coming period are as follows:Engine parts$1,085,000Shop direct labor792,000Shop and repair equipment depreciation31,100Shop supervisor salaries86,400Shop property taxes15,700Shop supplies12,000Advertising expense21,700Administrative office salaries93,300Administrative office depreciation expense11,900Total costs and expenses$2,149,100The average shop direct labor rate is $24 per hour.Determine the predetermined shop overhead rate per direct labor hour. Round the answer to nearest whole cent.$4per direct labor hour

Shop direct labor =$792,000 Shop and repair equipment depreciation =$31,100 Shop supervisor…

Answered: Determine the predetermined shop…

Determine the predetermined shop overhead rate per direct labor hour. Round the answer to nearest whole cent. per direct labor hour

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: omplete the job cost sheet for Job Alpha. (Round your intermediate calculations to 2 decimal…

A: Direct Materials Cost: This represents the cost of raw materials directly used in Job…

Q: rent companies use different bases in computing their predetermined overhead rates. From the…

A: The pre-determined overhead rate is calculated as the estimated overhead costs divided by the…

Q: ems Estimated Overhead Cost Driver Activity Levels Activity Rate Purchasing $70,000 ? ? ? Handling…

A: In actvity based costing, overhead cost are assigned on the basis of activities performed for the…

Q: Calculate the overhead cost assigned to the job if the company used the overhead rates developed in…

A: Total overhead cost (step down method) $84,522Total overhead cost (Direct method)…

Q: Required: 1. Assume Delph uses departmental predetermined overhead rates based on machine-hours. a.…

A: Requirement 1A: Computation of departmental predetermined overhead rates Note: Overhead rates are…

Q: The following data pertain to the Oneida Restaurant Supply Company for the year just ended. Budgeted…

A: Overhead: It represents the indirect costs incurred in production, such as utilities and rent, which…

Q: Calculate the Predetermined Overhead Rate (round to two decimal places $ X.XX). The company…

A: PREDETERMINED OVERHEAD RATE Predetermined rate means an indirect cost rate. predetermined overhead…

Q: If a company incurred $5,250 is actual overhead costs and allocated $5,575 to jobs, was the overhead…

A: Journal entries are prepared to record the financial and non financial transactions of the business…

Q: Sultan Company uses an activity - based costing system. At the beginning of the year, the company…

A: The provided information outlines Sultan Company's activity-based costing system estimates for the…

Q: Assume the following: Estimated fixed manufacturing overhead for the coming period of $202, 000…

A: Overheads: These are defined as the ongoing expenses incurred by the business which are not directly…

Q: 4. If Job P includes 20 units, what is its unit product cost? 5. What is the total manufacturing…

A: Manufacturing overhead are the total indirect costs that occured during production of the product.…

Q: RALPH Inc. has three producing departments (R, A, and L) and two service departments (P and H).…

A: using algebraic method allocation is to be done on the basis of direct labour hours , since service…

Q: A company estimated 149,795 direct labor hours and $643,490 in overhead. The actual overhead was…

A: Predetermined Overhead Rate:- It is the rate calculated by dividing the manufacturing cost with the…

Q: Provide the Correct answer of the question

A: Step 1:What is the total number of equivalent units for materials during the…

Q: Assume (1) estimated manufacturing overhead for the coming period of $314,000, (2) actual…

A: PREDETERMINED OVERHEAD RATEPredetermined rate means the indirect cost rate.Predetermined overhead…

Q: 1 Assume Delph uses departmental predetermined overhead rates based on machine-hours. a Compute the…

A: At the commencement of the accounting cycle, a predetermined overhead rate is computed by dividing…

Q: During the coming accounting year, Ester Manufacturing, Inc., anticipates the following costs,…

A: The expected cost of manufacturing overhead is applied to cost objects for a particular reporting…

Q: Give correct Manufacturing overhead rate

A: Step 1: Introduction to the OverheadOverhead expenses are indirect expenses of the business and…

Q: Saddle Inc. has two types of handbags: standard and custom. The controller has decided to use a…

A: Activity Rate :— It is the rate used to allocate manufacturing overhead cost to cost object under…

Q: Marquis Company estimates that annual manufacturing overhead costs will be $900,000. Estimated…

A: Overhead rate per direct labor cost= est. annual manufacturing overhead costs / est. annual direct…

Q: Fisher Fixtures manufactures three types of lighting fixtures, with model names of Silver, Gold, and…

A: The pre-determined Overhead rate is an allocation rate used to allocate the manufacturing overheads.…

Q: Which one of the following is related to the planning function of management: a. Establishing goals

A: Overhead rates refers to the cost allocated to the production of a product or a service required by…

Q: Required: 1. Calculate the per-unit cost of Jobs 78 and 79. Round your answers to the nearest cent.…

Q: fill out the yellow highlighted cells based on the information provided

A: There are several forms of cost accounting that is being used in business. One of them is Job…

Q: Compute the rate charged per hour of labor. Labor rate $ per hour

A: The labor rate is a rate, Based on this rate a company or a employer pays money to an employee for…

Q: Job A includes direct materials costs of $1,400 and direct labor costs of $950. If the predetermined…

A: Total cost of job includes direct cost and overhead costs.

Q: All the following statements about multiple predetermined overhead rates are correct, EXCEPT: O a.…

A: Predetermined overhead rate is estimated rate at which overheads of the business is to be allocated…

Q: WHAT IS THE ACTIVITY UNDER THE ABC SYSTEM FOR ACTIVITY 3 2. WHAT WOULD BE THE TOTAL OVERHEAD…

A: Here in this question we are required to calculate activity rate for activity 3, amount transferred…

Q: Figuring a predetermined overhead rate using direct materials as the allocation base. $130500…

A: Given information, Estimated manufacturing overhead costs are $130500 and direct materials are…

Q: applies overhead based on machine hours. At the beginning of 20x1, the company estimated that…

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: Assume the following: 1. Estimated fixed manufacturing overhead for the coming perio $220,000 2.…

A: Predetermined Overhead Rate is the rate used to allocate manufacturing overhead cost to cost object…

Q: Hultquist Corporation has two manufacturing departments--Forming at the beginning of the period to…

A: Overhead recovery rate can be computed by dividing the Total Estimated Overhead by the Estimated…

Q: Calculate activity-based overhead rate for each activity. (Round answers to 2 decimal places, e.g.…

A: Lets understand the basics.Overhead costs are the indirect costs which are not directly traceable…

Q: per processing hour b. Use the overhead rate in (a) to determine the amount of total and per-case…

A: Solution:- a)Determination of the single plantwide factory overhead rate as follows under:- Formula…

Q: a. Calculate the total manufacturing costs and the cost per unit produced and "Cost per unit" to 2…

A: Activity-based costing: Activity-based costing (ABC): It is a method of distribution of overheads…

Q: REQUIREMIENTS: What is the predetermined overhead rate? What is the amount of overhead applied for…

A: Overheads are the indirect costs related to production of goods.

Q: predetermined overhead rates

A: Predetermined overhead rates are calculated by dividing pre-estimated overhead using allocation…

Q: Selling price Direct labor costs Other variable costs D $181.00 $283.20 28.60 E 90 83.60 78 F…

A: Direct labor expenses are a substantial component of overall production costs since they include…

Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

Predetermined Factory Overhead Rate
Road Runner Engine Shop uses a job order cost system to determine the cost of performing engine repair work. Estimated costs and expenses
for the coming period are as follows:
Engine parts
$1,085,000
Shop direct labor
792,000
Shop and repair equipment depreciation
31,100
Shop supervisor salaries
86,400
Shop property taxes
15,700
Shop supplies
12,000
Advertising expense
21,700
Administrative office salaries
93,300
Administrative office depreciation expense
11,900
Total costs and expenses
$2,149,100
The average shop direct labor rate is $24 per hour.
Determine the predetermined shop overhead rate per direct labor hour. Round the answer to nearest whole cent.
$4
per direct labor hour

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step - Given

VIEW

Step 2- working notes

VIEW

Step 3- Answer

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

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

When calculating the predetermined manufacturing overhead rate, what is the correct basis of calculation? a.Estimated overhead costs divided by the estimated amount of the cost driver or allocation base b.Estimated amount of the cost driver divided by the estimated total overhead costs c.Estimated overhead costs divided by the number of days in a year d.Actual overhead costs of the prior year divided by the actual amount of the cost driver or allocation base
Ramsey Company produces speakers (Model A and Model B). Both products pass through two producing departments. Model A's production is much more labor-intensive than that of Model B. Model B is also the more popular of the two speakers. The following data has been gathered for the two products: Units produced per year Prime costs Direct labor hours Machine hours Production runs Inspection hours Maintenance hours Overhead costs: Setup costs Inspection costs Machining Maintenance Total Model A 10,000 $153,000 144,000 17,000 30 900 9,000 $216,000 220,000 172,000 300,000 $908,000 Product Data Model B 100,000 $1,530,000 310,000 204,000 60 1,300 91,000
Estimated overhead to be $ 500000 , Direct labor hours are 50000 , Machine hours are to be 25000 , overhead applied based on Direct labor What is the predtermined overhead rate?
How to solve the factory overhead rate of 2/3 of the labor cost?
Jackson Foundry uses a predetermined overhead allocation rate to allocate overhead to individual jobs, based on the machine hours required. (Click the icon to view the costs.) Requirements 1. 2. 3. Compute Jackson's predetermined overhead allocation rate. Prepare the journal entry to allocate manufacturing overhead. Post the manufacturing overhead transactions to the Manufacturing Overhead T-account. Is manufacturing overhead underallocated or overallocated? By how much? 4. Prepare the journal entry to adjust for the underallocated or overallocated manufacturing overhead. Does your entry increase or decrease Cost of Goods Sold? Print Allocated overhead to WIP Done - X Data table At the beginning of 2024, the company expected to incur the following: Manufacturing overhead costs Direct labor costs $880,000 1,540,000 Machine hours 80,000 hours At the end of 2024, the company had actually incurred: Direct labor costs Depreciation on manufacturing plant and equipment Property taxes on plant…
Steeler Towel Company estimates its overhead to be $483,000. It expects to have 138,000 direct labor hours costing $4,830,000 in labor and utilizing 11,500 machine hours. Calculate the predetermined overhead rate using: Round your answers to two decimal places. A. Direct labor hours $fill in the blank 1 per direct labor hour B. Direct labor dollars $fill in the blank 2 per direct labor dollar C. Machine hours $fill in the blank 3 per machine hour
In a factory, a team of six maintenance staff are paid a guaranteed weekly wage. Which of the following is the most appropriate cost classification for their wages? Direct labour cost Indirect labour cost Semi-variable cost Variable overhead cost
Calculate the amount of overhead allocated to the products of a company that has a predetermined overhead rate of $10 per machine hour if machines were used for 10,000 hours.
Rex Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Compute the overhead rate for each activity. Round your answers to two decimal places. Overhead Overhead Annual Rate per Activity per Activity Usage Activity Machine Setups $157,850 4,100 $ Machine Hours 324,622 14,114 2$ Inspections 119,000 3,400
please solve for overhead rate per direct labor cost, overhead rate per direct labor hour, and overhead rate per machine hour
Please help me
Quetion: Calculate the required total labor hours, if there are 5,000 units produced and 2.5 units are produced per labor.