Forsythe​, Inc. uses​ activity-based costing to account for its chrome bumper manufacturing process. Company managers have identified four manufacturing​ activities: materials​ handling, machine​ setup, insertion of​ parts, and finishing. The budgeted activity costs for the year and their allocation bases are as​ follows: 1​(Click the icon to view the budgeted costs and activity​ bases.)   Read the requirements2.   Requirement 1. Compute the predetermined overhead allocation rate for each activity.   Begin by selecting the formula to calculate the predetermined overhead​ (OH) allocation rate. Then enter the amounts to compute the allocation rate for each activity. ​(Round your answers to the nearest​ cent.)               Predetermined OH   (1)   ÷ (2)   = allocation rate Materials handling   ÷   =   Machine setup   ÷   =   Insertion of parts   ÷   =   Finishing   ÷   =   Requirement 2. Job 86 required the production of 140 bumpers and required one setup. Compute the indirect manufacturing cost allocated to Job 86.   Begin by selecting the formula to allocate overhead​ (OH) costs.   (3)   × (4)   = Allocated mfg. overhead costs Job 86 required the production of 140 bumpers and required one setup. Compute the indirect manufacturing cost allocated to Job 86. ​(Round all amounts to the nearest​ cent.)   Job 86: Allocated Mfg. OH Cost Materials handling   Machine setup   Insertion of parts   Finishing   Total mfg. OH costs   1: Data Table Activity Total Budgeted Cost Allocation Base Materials handling $14,000 Number of parts Machine setup 4,200 Number of setups Insertion of parts 52,000 Number of parts Finishing 78,000 Finishing direct labor hours Total $148,200   Forsythe expects to produce 500 chrome bumpers during the year. The bumpers are expected to use 2,000 ​parts, require 5 ​setups, and consume 2,000 hours of finishing time. 2: Requirements 1. Compute the predetermined overhead allocation rate for each activity. 2. Job 86 required the production of 140 bumpers and required one setup. Compute the indirect manufacturing cost allocated to Job 86. (1)        Actual overhead costs   Actual qty of the allocation base used   Estimated overhead costs   Estimated qty of the allocation base (2)        Actual overhead costs   Actual qty of the allocation base used   Estimated overhead costs   Estimated qty of the allocation base (3)        Actual overhead costs   Estimated overhead costs   Expected qty of the allocation base used   Predetermined OH allocation rate (4)        Actual overhead costs   Estimated overhead costs   Expected qty of the allocation base used   Predetermined OH allocation rate

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Forsythe​,
Inc. uses​ activity-based costing to account for its chrome bumper manufacturing process. Company managers have identified four manufacturing​ activities: materials​ handling, machine​ setup, insertion of​ parts, and finishing. The budgeted activity costs for the year and their allocation bases are as​ follows:
1​(Click
the icon to view the budgeted costs and activity​ bases.)
 
Read the
requirements2.
 
Requirement 1. Compute the predetermined overhead allocation rate for each activity.
 
Begin by selecting the formula to calculate the predetermined overhead​ (OH) allocation rate. Then enter the amounts to compute the allocation rate for each activity. ​(Round your answers to the nearest​ cent.)
 
 
 
 
 
 
 
Predetermined OH
 
(1)  
÷
(2)  
=
allocation rate
Materials handling
 
÷
 
=
 
Machine setup
 
÷
 
=
 
Insertion of parts
 
÷
 
=
 
Finishing
 
÷
 
=
 
Requirement 2. Job 86 required the production of
140
bumpers and required one setup. Compute the indirect manufacturing cost allocated to Job 86.
 
Begin by selecting the formula to allocate overhead​ (OH) costs.
 
(3)  
×
(4)  
=
Allocated mfg. overhead costs
Job 86 required the production of
140
bumpers and required one setup. Compute the indirect manufacturing cost allocated to Job 86. ​(Round all amounts to the nearest​ cent.)
 
Job 86:
Allocated Mfg. OH Cost
Materials handling
 
Machine setup
 
Insertion of parts
 
Finishing
 
Total mfg. OH costs
 
1: Data Table
Activity
Total Budgeted Cost
Allocation Base
Materials handling
$14,000
Number of parts
Machine setup
4,200
Number of setups
Insertion of parts
52,000
Number of parts
Finishing
78,000
Finishing direct labor hours
Total
$148,200
 
Forsythe
expects to produce
500
chrome bumpers during the year. The bumpers are expected to use
2,000
​parts, require
5
​setups, and consume
2,000
hours of finishing time.
2: Requirements
1.
Compute the predetermined overhead allocation rate for each activity.
2.
Job 86 required the production of
140
bumpers and required one setup. Compute the indirect manufacturing cost allocated to Job 86.
(1) 
 
 
 
Actual overhead costs
 
Actual qty of the allocation base used
 
Estimated overhead costs
 
Estimated qty of the allocation base
(2) 
 
 
 
Actual overhead costs
 
Actual qty of the allocation base used
 
Estimated overhead costs
 
Estimated qty of the allocation base
(3) 
 
 
 
Actual overhead costs
 
Estimated overhead costs
 
Expected qty of the allocation base used
 
Predetermined OH allocation rate
(4) 
 
 
 
Actual overhead costs
 
Estimated overhead costs
 
Expected qty of the allocation base used
 
Predetermined OH allocation rate
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