Huckvale Corporation manufactures custom cabinets for kitchens. It uses a normal-costing system with two direct cost categories-direct materials and direct manufacturing labor-and one indirect-cost pool, manufacturing overhead costs. View the manufacturing overhead costs information for 2020. View the other information available as of December 31, 2020. Requirement Calculate the underallocated or overallocated manufacturing overhead at the end of 2020 and prorate it to Work-in-Process Control, Finished Goods Control, and Cost of Goods Sold accounts ba on the allocated manufacturing overhead in each account balance using normal costing. XII Begin by calculating the budgeted indirect cost rate. Identify the formula and then calculate the rate. (Assume the cost allocation base is direct labor hours.) Budgeted indirect cost rate Manufacturing Overhead Costs Information - X
Huckvale Corporation manufactures custom cabinets for kitchens. It uses a normal-costing system with two direct cost categories-direct materials and direct manufacturing labor-and one indirect-cost pool, manufacturing overhead costs. View the manufacturing overhead costs information for 2020. View the other information available as of December 31, 2020. Requirement Calculate the underallocated or overallocated manufacturing overhead at the end of 2020 and prorate it to Work-in-Process Control, Finished Goods Control, and Cost of Goods Sold accounts ba on the allocated manufacturing overhead in each account balance using normal costing. XII Begin by calculating the budgeted indirect cost rate. Identify the formula and then calculate the rate. (Assume the cost allocation base is direct labor hours.) Budgeted indirect cost rate Manufacturing Overhead Costs Information - X
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
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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Transcribed Image Text:Huckvale Corporation manufactures custom cabinets for kitchens. It uses a normal-costing system with two direct cost categories-direct materials and direct manufacturing labor-and
one indirect-cost pool, manufacturing overhead costs.
View the manufacturing overhead costs information for 2020.
View the other information available as of December 31, 2020.
Requirement
Calculate the underallocated or overallocated manufacturing overhead at the end of 2020 and prorate it to Work-in-Process Control, Finished Goods Control, and Cost of Goods Sold accounts based
on the allocated manufacturing overhead in each account balance using normal costing.
Begin by calculating the budgeted indirect cost rate. Identify the formula and then calculate the rate. (Assume the cost allocation base is direct labor hours.)
Budgeted indirect cost
rate
+
+
Manufacturing Overhead Costs
Print
Budgeted manufacturing overhead costs
Budgeted direct manufacturing labor hours
Actual manufacturing overhead costs
Actual direct manufacturing labor-hours
Done
$ 1,260,000
$
36,000 hours
1,064,000
28,000 hours
C...
-
Information
Account
Work-in-process control
Finished goods control
Cost of goods sold
Total
Print
Account Balance
(Before Proration)
$
43,000
61,000
$
$
1,300,000
$
1,404,000
Done
Actual Direct
Manufacturing
Labor-Hours
1,260
1,540
25,200
28,000
-
X
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