Landen Corporation uses job-order costing. At the beginning of the year, it made the following estimates: Direct labor-hours required to support estimated production Machine-hours required to support estimated production Fixed manufacturing overhead cost Variable manufacturing overhead cost per direct labor-hour Variable manufacturing overhead cost per machine-hour During the year, Job 550 was started and completed. The following information pertains to this job: Direct materials. Direct labor cost Direct labor-hours Machine-hours 125,000 62,500 $ 350,000 $ 201 $ 240 15 5 $ 3.80 $ 7.60 Required: 1. Assume Landen has historically used a plantwide predetermined overhead rate with direct labor-hours as the allocation base. Under this approach: a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost of Job 550. c. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?

Landen Corporation uses job-order costing. At the beginning of the year, it made the following estimates: Direct labor-hours required to support estimated production Machine-hours required to support estimated production Fixed manufacturing overhead cost Variable manufacturing overhead cost per direct labor-hour Variable manufacturing overhead cost per machine-hour During the year, Job 550 was started and completed. The following information pertains to this job: Direct materials. Direct labor cost Direct labor-hours Machine-hours 125,000 62,500 $ 350,000 $ 201 $ 240 15 5 $ 3.80 $ 7.60 Required: 1. Assume Landen has historically used a plantwide predetermined overhead rate with direct labor-hours as the allocation base. Under this approach: a. Compute the plantwide predetermined overhead rate. b. Compute the total manufacturing cost of Job 550. c. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?

Name: Landen Corporation uses job-order costing. At the beginning of the ye
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Description: Landen Corporation uses job-order costing. At the beginning of the year, it made the following estimates:Direct labor-hours required to support estimated productionMachine-hours required to support estimated productionFixed manufacturing overhead co

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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Concept explainers

Process Costing

Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure. 

Job Costing

Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.

ABC Costing

Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.

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Question

Landen Corporation uses job-order costing. At the beginning of the year, it made the following estimates:
Direct labor-hours required to support estimated production
Machine-hours required to support estimated production
Fixed manufacturing overhead cost
Variable manufacturing overhead cost per direct labor-hour
Variable manufacturing overhead cost per machine-hour
During the y
Direct materials
Direct labor cost
Direct labor-hours
e year, Job 550 was started and completed. The following information pertains to this job:
Machine-hours
$ 201
$ 240
15
5
Required:
1. Assume Landen has historically used a plantwide predetermined overhead rate with direct labor-hours as the allocation base.
Under this approach:
125,000
62,500
$ 350,000
a. Compute the plantwide predetermined overhead rate.
b. Compute the total manufacturing cost of Job 550.
c. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?
1. Direct labor-hours:
1a. Predetermined overhead rate
$ 3.80
$ 7.60
2. Assume Landen's controller believes that machine-hours is a better allocation base than direct labor-hours. Under this approach:
a. Compute the plantwide predetermined overhead rate.
b. Compute the total manufacturing cost of Job 550.
c. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550?
Note: Round your intermediate calculations to 2 decimal places. Round your Predetermined Overhead Rate answers to 2 decimal
places and all other answers to the nearest whole dollar.
1b. Total manufacturing cost of Job 550
1c. Selling price
2. Machine-hours:
2a. Predetermined overhead rate
2b. Total manufacturing cost of Job 550
2c. Selling price
per DLH
per MH

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