Molly just started working as a junior accountant at a manufacturing firm that uses job order costing. She has asked you, the senior accountant, fo some help with calculating overhead allocation rates. The following data has been provided for the year ended December 31, 2020: Estimated Actual Machine Hours Direct Labor Hours Direct Labor Cost Manufacturing Overhead Cost 10,000 20,000 $200,000 $560,000| 11,000 19,000 $190,000 $600,000 Actual data from August is as follows: Machine Hours Direct Labor Hours Direct Labor Cost August 900 1,600 $16,000 a. If the company uses a normal costing system and has selected machinehours as the appropriate allocation base, what is the allocation rate? b. Using the allocation rate determined in part 1, what is the amount of overhead allocated for the month ended August 31, 2020

Molly just started working as a junior accountant at a manufacturing firm that uses job order costing. She has asked you, the senior accountant, fo some help with calculating overhead allocation rates. The following data has been provided for the year ended December 31, 2020: Estimated Actual Machine Hours Direct Labor Hours Direct Labor Cost Manufacturing Overhead Cost 10,000 20,000 $200,000 $560,000| 11,000 19,000 $190,000 $600,000 Actual data from August is as follows: Machine Hours Direct Labor Hours Direct Labor Cost August 900 1,600 $16,000 a. If the company uses a normal costing system and has selected machinehours as the appropriate allocation base, what is the allocation rate? b. Using the allocation rate determined in part 1, what is the amount of overhead allocated for the month ended August 31, 2020

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Description: Molly just started working as a junior accountant at a manufacturing firm that uses job order costing. She has asked you, the senior accountant, forsome help with calculating overhead allocation rates. The following data has been provided for the ye

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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! Required information [The following information applies to the questions displayed below.] At the end of June, the job cost sheets at Ace Roofers show the following costs accumulated on three jobs. Job 7 $ 27,800 22,600 11,300 At June 30 Direct materials Direct labor Overhead applied Additional Information Job 5 $ 16,600 9,600 4,800 Job 6 $ 33,800 15,800 7,900 a. Job 5 was started in May, and the following costs were assigned to it in May: direct materials, $6,800; direct labor, $2,600; and applied overhead, $1,700. Job 5 was finished in June. b. Job 6 and Job 7 were started in June; Job 6 was finished in June, and Job 7 is to be completed in July. c. Overhead cost is applied with a predetermined rate based on direct labor cost. The predetermined overhead rate did not change across these months. Direct labor used in June 2. What is the total cost of direct labor used in June?
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Mary Ellis owns a small manufacturing company and would like to develop more accurate estimates for overhead expenses when making planning decisions. She is pretty sure that overhead is a mixed cost that varies with direct labour-hours but she would like to do a proper analysis to determine the variable and fixed components. She collected the following information for the past 12 months on direct labour-hours incurred and total overhead expenses. Total Overhead Costs $44,000 Month January Direct Labour-Hours 1,500 February 1,680 $ 47,200 March 1,000 $ 48,000 April 2,520 $ 51,200. May 2,700 $ 53,600 June 3,300 $ 56,000 July 3,900 $ 59,200 August 4,500 $ 61,600 September 4,200 $ 60,000 October 2,700 $ 54,400 November 1,800 $49,600 December 3,900 $ 58,400 Required: 1. Using the least-squares regression method, estimate the variable overhead cost per direct labour-hour and the total fixed overhead cost per month. (Round Fixed cost to the nearest whole doller amount and the Variable cost…