Golf Corporation estimates that its production for the coming year will be 25,000 units, which is 90% of normal capacity, with the following units costs: Materials P50 Direct labor 90 Direct labor is paid at the rate of P25 per hour. The machine should be run 20 minutes to produce one unit. Total estimated overhead is expected to consist of P900,000 for variable overhead and P900,000 for fixed overhead.
Golf Corporation estimates that its production for the coming year will be 25,000 units, which is 90% of normal capacity, with the following units costs: Materials P50 Direct labor 90 Direct labor is paid at the rate of P25 per hour. The machine should be run 20 minutes to produce one unit. Total estimated overhead is expected to consist of P900,000 for variable overhead and P900,000 for fixed overhead.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter2: Job Order Costing
Section: Chapter Questions
Problem 4CMA: Patterson Corporation expects to incur 70,000 of factory overhead and 60,000 of general and...
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Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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1. Golf Corporation estimates that its production for the coming year will be 25,000 units, which is 90% of normal capacity, with the following units costs: Materials P50 Direct labor 90 Direct labor is paid at the rate of P25 per hour. The machine should be run 20 minutes to produce one unit. Total estimated overhead is expected to consist of P900,000 for variable overhead and P900,000 for fixed overhead.
d. What is the predetermined overhead rate base on direct labor hours? e. What is the predetermined overhead rate based on machine hours? f. What is the predetermined overhead rate base on units of production using the normal capacity level?
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