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Estimated cost and operating data for three companies for the upcoming year follow Company Direct labour-hours Machine-hours Direct materials cost Manufacturing overhead cost 80,000 40,000 400,000 Company A C 40,000 50,000 60,000 20,000 $ $ 280,000 $ 300,000 $ 520,000 $ 576,000 $ 900,000 redetermined overhead rates are computed using the following bases in the three companies: Overhead Rate Based on Direct labour-hours Machine-hours Direct materials cost

Estimated cost and operating data for three companies for the upcoming year follow Company Direct labour-hours Machine-hours Direct materials cost Manufacturing overhead cost 80,000 40,000 400,000 Company A C 40,000 50,000 60,000 20,000 $ $ 280,000 $ 300,000 $ 520,000 $ 576,000 $ 900,000 redetermined overhead rates are computed using the following bases in the three companies: Overhead Rate Based on Direct labour-hours Machine-hours Direct materials cost

FINANCIAL ACCOUNTING
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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Estimated cost and operating data for three companies for the upcoming year follow: Company 11 Direct labour-hours Machine hours Direct materials cost Manufacturing overhead cost Company A B с Predetermined overhead rates are computed using the following bases in the three companies: Overhead Rate Based on Direct labour-hours Machine-hours Direct materials cost Company A C 60,000 40,000 80,000 20,000 $ 400,000 $ 280,000 $ 300,000 $ 520,000 $ 576,000 $ 900,000 Required: 1. Compute the predetermined overhead rate to be used in each company during the upcoming year. (Round your answers to 2 decimal places.) B 80,000 40,000 C Predetermined Overhead Rate per DLH per MH % of DMC
Transcribed Image Text:Estimated cost and operating data for three companies for the upcoming year follow: Company 11 Direct labour-hours Machine hours Direct materials cost Manufacturing overhead cost Company A B с Predetermined overhead rates are computed using the following bases in the three companies: Overhead Rate Based on Direct labour-hours Machine-hours Direct materials cost Company A C 60,000 40,000 80,000 20,000 $ 400,000 $ 280,000 $ 300,000 $ 520,000 $ 576,000 $ 900,000 Required: 1. Compute the predetermined overhead rate to be used in each company during the upcoming year. (Round your answers to 2 decimal places.) B 80,000 40,000 C Predetermined Overhead Rate per DLH per MH % of DMC
2-a. Assume that company A works on three jobs during the upcoming year. Direct labour-hours recorded by job are as follows: job 418, 24,000 hours; job 419, 40,000 hours; job 420, 12,000 hours. How much overhead cost will the company apply to work in process for the year? (Do not round intermediate calculations.) Overhead cost applied 2-b. If actual overhead costs total $517,000 for the year, will overhead be under- or overapplied? By how much? (Do not round intermediate calculations.) overhead cost V
Transcribed Image Text:2-a. Assume that company A works on three jobs during the upcoming year. Direct labour-hours recorded by job are as follows: job 418, 24,000 hours; job 419, 40,000 hours; job 420, 12,000 hours. How much overhead cost will the company apply to work in process for the year? (Do not round intermediate calculations.) Overhead cost applied 2-b. If actual overhead costs total $517,000 for the year, will overhead be under- or overapplied? By how much? (Do not round intermediate calculations.) overhead cost V
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