Next year, Pine Corp. expects to spend a total of 198,250 direct labor hours producing four models of widget, while Spruce Inc. expects to spend a total of 172,050 hours producing three models. Both firms allocate overhead on the basis of direct labor hours. If Pine anticipates a total overhead of $1.2 million and Spruce anticipates a total overhead of $1.1 million, then (Pine/Spruce) has a higher predetermined ove

Next year, Pine Corp. expects to spend a total of 198,250 direct labor hours producing four models of widget, while Spruce Inc. expects to spend a total of 172,050 hours producing three models. Both firms allocate overhead on the basis of direct labor hours. If Pine anticipates a total overhead of $1.2 million and Spruce anticipates a total overhead of $1.1 million, then (Pine/Spruce) has a higher predetermined ove

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

RLW-II Enterprises estimated that indirect manufacturing costs for the year would be $75 million and that 15,000 machine-hours would be used. (a) Compute the predetermined indirect cost application rate using machine hours as the burden vehicle. (b) Determine the total cost of production for a product with direct material costs of $2 million, direct-labor costs of $2.5 million, and 200 machine-hours.
Jordan Inc. manufactures Product B, incurring variable product costs of $15.00 per unit and fixed product costs of $70,000. Total Selling and Administrative Expenses for the year are expected to be $15,700. Jordan desires a profit equal to a 10% rate of return on assets, $785,000 of assets are devoted to producing Product B, and 100,000 units are expected to be produced and sold. (a) Compute the markup percentage, using the product cost concept. (b) Compute the normal selling price of Product B. (a) (b)
Please help me
Company XYZ is currently producing and selling 100 units. At this level, the total direct materials cost is $500, the total direct labor cost is $1,800 and the total manufacturing overhead cost is $1,260, which includes $800 fixed manufacturing overhead cost. The company's total selling and administrative expenses are $2,800, which include $1,500 fixed selling and administrative costs. Assume that the company wishes to increase the number of units produced and sold to 102 units, what would be the incremental cost? (rounded to nearest ($) value) O a. 71 O b. 81 О с. None of the given answers O d. 41 О е. 55 AGE NEXT PAGE %3D ere to search
Rundle Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials adn labor costs are as follows. Expected Cost Home 1 Home 2 Home 3 Direct Labor $77,000 $100,000 $172,000 Direct Materials 108,000 146,000 198,000 Assume Randle needs to allocate two major overhead costs ($69,800 of employee fringe benefits and $36160 of indirect materials costs) among the three jobs. Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each house. "Round allocated rate to two decimal places.
Magnificent Modems has excess production capacity and is considering the possibility of making and selling security tokens. The following estimates are based on a production and sales volume of 1,000 security tokens. Unit-level manufacturing costs are expected to be $20. Sales commissions will be established at $1 per unit. The current facility-level costs, including depreciation on manufacturing equipment ($60,000), rent on the manufacturing facility ($50,000), depreciation on the administrative equipment ($12,000), and other fixed administrative expenses ($71,950), will not be affected by the production of the security tokens. The chief accountant has decided to allocate the facility-level costs to the existing product (modems) and to the new product (security tokens) on the basis of the number of units of product made (i.e., 5,000 modems and 1,000 security tokens). Required a. Determine the per-unit cost of making and selling 1,000 security tokens. Note: Do not round intermediate…
Acklin Company has two products: A and B. The annual production and sales of Product A is 600 units and of Product B is 900 units. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Product A requires 0.5 direct labor-hours per unit and Product B requires 0.3 direct labor-hours per unit. The total estimated overhead for next period is $63,322. The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for external reports. The new activity-based costing system would have three overhead activity cost pools--Activity 1, Activity 2, and General Factory--with estimated overhead costs and expected activity as follows: Activity Cost Pool Est Ovhd Cost Expected Acty - Prod A Expected Acty -Prod B Total Activity 1 $ 18,900 700 200 900 Activity 2 $ 15,631 1,000 100 1,100 General Factory $ 28,791 300 270 570 Total $ 63,322 The overhead cost per…
Georgia Temps, a large labor contractor, supplies contract labor to building-construction companies. For 2017, Georgia Temps has budgeted to supply 84,000 hours of contract labor. Its variable costs are $13 per hour, and its fixed costs are $168,000. Roger Mason, the general manager, has proposed a cost-plus approach for pricing labor at full cost plus 20%. Q. Calculate the price per hour that Georgia Temps should charge based on Mason’s proposal.
Vishnu
The Matrix Company has three product lines of belts-A, B, and C-with contribution margins of $7, $5, and $4, respectively. The president foresees sales of 400,000 units in the coming period, consisting of 40,000 units of A, 200,000 units of B, and 160,000 units of C. The company's fixed costs for the period are $1,020,000. What is the total number of units required to breakeven? Answer:
Rundle Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows. Expected Direct labor Home 1: $63,000 Home 2: $108,000, Home 3: $181,000 Direct materials Home 1: 98,000 Home 2: 143,000 Home 3: 186,000 Assume Rundle needs to allocate two major overhead costs ($ 52,800 of employee fringe benefits and $12,,810 of indirect materials cost) among the three Jobs. required; Choose an appropriate cost driver for each of the overhead costs and determine the cost of each house ( round " allocation rate to 2 decimal places.)
Sage Company is operating at 90% of capacity and is currently purchasing a part used in its manufacturing operations for $14.00 per unit. The unit cost for the business to make the part is $22.00, including fixed costs, and $11.00, excluding fixed costs. If 39,879 units of the part are normally purchased during the year but could be manufactured using unused capacity, what would be the amount of differential cost increase or decrease from making the part rather than purchasing it? a.$558,306 cost decrease b.$119,637 cost increase c.$319,032 cost increase d.$119,637 cost decrease