Kluth Corporation has two manufacturing departments--Molding and Customizing. The company used the following data at the beginning of the year to calculate predetermined overhead rates: Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH $ 2.50 Molding Customizing Total 9,000 1,400 10,400 $36,000 $3,920 $39,920 $ 5.00 During the most recent month, the company started and completed two jobs--Job C and Job M. There were no beginning inventories. Data concerning those two jobs follow. Direct materials Direct labor cost Molding machine-hours Customizing machine-hours Job C Job M $14,100 $7,900 $21,100 $7,900 2,700 6,300 800 600 Required: Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. Further assume that the company uses a markup of 20% on manufacturing cost to establish selling prices. Calculate the selling prices for Job C and for Job M. (Do not round intermediate calculations.) Selling price for Job C Selling price for Job M
Kluth Corporation has two manufacturing departments--Molding and Customizing. The company used the following data at the beginning of the year to calculate predetermined overhead rates: Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH $ 2.50 Molding Customizing Total 9,000 1,400 10,400 $36,000 $3,920 $39,920 $ 5.00 During the most recent month, the company started and completed two jobs--Job C and Job M. There were no beginning inventories. Data concerning those two jobs follow. Direct materials Direct labor cost Molding machine-hours Customizing machine-hours Job C Job M $14,100 $7,900 $21,100 $7,900 2,700 6,300 800 600 Required: Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. Further assume that the company uses a markup of 20% on manufacturing cost to establish selling prices. Calculate the selling prices for Job C and for Job M. (Do not round intermediate calculations.) Selling price for Job C Selling price for Job M
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter26: Manufacturing Accounting: The Job Order Cost System
Section: Chapter Questions
Problem 5SEB: PREDETERMINED FACTORY OVERHEAD RATE Marston Enterprises calculates a predetermined factory overhead...
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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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