Omstadt Corporation produces and sells only two products that are referred to as RIPS and PITS. Production is "for order" only, and no finished goods inventories are maintained; work in process inventories are negligible. The following data relate to last month's operations: RIPS PITS Sales $180,000 $180,000 Man. Costs Materials $18,000 $24,000 Direct Labor $54,000 $48,000 Overhead $72,000 $84,000 Selling Exp. $14,400 $10,080 Admin. Exp $12,000 $18,000 $36,000 of the manufacturing overhead assigned to RIPS and $72,000 of that assigned to PITS is fixed. The balance of the overhead is variable. Selling expenses consist entirely of commissions paid as a percentage of sales. Direct Labor is completely variable. Admin Exp are fixed and cannot be traced to the products but have been arbitrarily allocated to the products. Required: Prepare a segmented income statement in total and for the two products. Use the contribution approach

Omstadt Corporation produces and sells only two products that are referred to as RIPS and PITS. Production is "for order" only, and no finished goods inventories are maintained; work in process inventories are negligible. The following data relate to last month's operations: RIPS PITS Sales $180,000 $180,000 Man. Costs Materials $18,000 $24,000 Direct Labor $54,000 $48,000 Overhead $72,000 $84,000 Selling Exp. $14,400 $10,080 Admin. Exp $12,000 $18,000 $36,000 of the manufacturing overhead assigned to RIPS and $72,000 of that assigned to PITS is fixed. The balance of the overhead is variable. Selling expenses consist entirely of commissions paid as a percentage of sales. Direct Labor is completely variable. Admin Exp are fixed and cannot be traced to the products but have been arbitrarily allocated to the products. Required: Prepare a segmented income statement in total and for the two products. Use the contribution approach

Name: Please do not give solution in image format thanku Omstadt Corporation
Uploaded: 2024-03-20T06:32:49.000Z
Channel: Bartleby
Description: Please do not give solution in image format thanku Omstadt Corporation produces and sellsonly two products that are referred to asRIPS and PITS. Production is "for order"only, and no finished goods inventories aremaintained; work in process inventori

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter2: Accounting For Materials

Section: Chapter Questions

Problem 17E: Davis Co. uses backflush costing to account for its manufacturing costs. The trigger points are the...

See similar textbooks

Similar questions

Lamont Company produced 80,000 machine parts for diesel engines. There were no beginning or ending work-in-process inventories in any department. Lamont incurred the following costs for May: Required: 1. Calculate the costs transferred out of each department. 2. Prepare the journal entries corresponding to these transfers. Also, prepare the journal entry for Grinding that reflects the costs added to the transferred-in goods received from Molding. 3. What if the Grinding Department had an ending WIP of 12,000? Calculate the cost transferred out and provide the journal entry that would reflect this transfer. What is the effect on finished goods calculated in Requirement 1, assuming the other two departments have no ending WIP?
Davis Co. uses backflush costing to account for its manufacturing costs. The trigger points are the purchase of materials, the completion of goods, and the sale of goods. Prepare journal entries to account for the following: a. Purchased raw materials, on account, 70,000. b. Requisitioned raw materials to production, 70,000. c. Distributed direct labor costs, 15,000. d. Factory overhead costs incurred, 45,000. (Use Various Credits for the account in the credit part of the entry.) e. Completed all of the production started. f. Sold the completed production for 195,000, on account. (Hint: Use a single account for raw materials and work in process.)
Oakes Inc. manufactured 40,000 gallons of Mononate and 60,000 gallons of Beracyl in a joint production process, incurring 250,000 of joint costs. Oakes allocates joint costs based on the physical volume of each product produced. Mononate and Beracyl can each be sold at the split-off point in a semifinished state or, alternatively, processed further. Additional data about the two products are as follows: An assistant in the companys cost accounting department was overheard saying ...that when both joint and separable costs are considered, the firm has no business processing either product beyond the split-off point. The extra revenue is simply not worth the effort. Which of the following strategies should be recommended for Oakes?
Sheddon Industries produces two products. The products' identified costs are as follows: Product A Product B Direct materials $20,000 $15,000 Direct labor $12,000 $24,000 The company's overhead costs of $108,000 are allocated based on direct labor cost. Assume 4,000 units of product A and 5,000 units of Product B are produced. What is the cost per unit for product B? (Do not round your intermediate calculations.)
Heidelberg Fabrication manufactures two products, G-09 and G-35: Units produced Direct materials cost per unit Machine-hours per unit Production runs per quarter Machine depreciation Setup labor Production at the plant is automated and any labor cost is included in overhead. Data on manufacturing overhead at the plant follow: Materials handling Total G-09 19,700 $ 7 4 G-35 3,940 $ 19 7 72 $ 106,380 53,190 42,552 $ 202,122 a. Overhead rate b. Machine depreciation b. Setup labor b. Materials handling Exercise 9-36 (Algo) Activity-Based Costing and Cost Driver Rates (LO 9-4) Required: a. Heidelberg currently applies overhead on the basis of machine-hours. What is the predetermined overhead rate for the quarter? Note: Round your answer to 2 decimal places. b. Heidelberg is thinking of adopting an ABC system. They have tentatively chosen the following cost drivers: machine-hours for machine depreciation, production runs for setup labor, and direct material dollars for materials handling.…
PAX Corporation uses Part BLX in the assembly of a major product line . The cost to produce one BLX is presented below : Direct materials P 4,000 Material handling (20% of direct materials) 800 Direct labor 2,000 Overhead 48,000 Total manufacturing costs P 84,800 Material handling which are not included in manufacturing overhead represents the direct variable costs of the receiving department that are applied to direct materials and purchased component on the basis of their costs. The company’s annual overhead budget is one-third variable and two-third fixed. Ten units of BLX are expected to be acquired for one month. ZIM Co. offers to supply BLX at a unit price of P 60,000. Pax, if it chooses to buy BLX can use the idle capacity to produce CZX that could contribute…
Subject : Accounting
Terrell Industries produces a single product at its Roosevelt facility. The product has two main inputs, metal and labor, with additional costs being included in manufacturing overhead. The plant carries neither work-in-process nor finished goods inventories. Information from the previous four quarters of production follows: Q1 Q2 Q3 Q4 Metal input (pounds) 194,000 210,000 240,000 230,000 Labor input (hours) 9,700 10,560 12,500 11,500 Sales (pounds) 164,900 184,800 204,000 190,900 Average price of metal per pound $ 0.62 $ 0.66 $ 0.70 $ 0.65 Average wage rate per hour 32.00 34.00 28.00 30.00 Average sales price per pound 6.20 5.95 6.10 6.00 Manufacturing overhead (total) 387,224 418,660 397,000 421,820 Required: a. Compute the partial productivity measures for metal for the four quarters. b. Compute the partial productivity measures for labor for the four quarters. c. Compute the total factor productivity for the four quarters.
(Management Accounting) Bonneville Company is producing a subassembly used in the production of a product. The costs incurred for the subassembly follow: Per Unit Direct materials $6.00 Direct labor 4.00 Variable factory overhead 1.00 Fixed supervisor salary 3.00 Depreciation expense on factory equipment 2.00 General fixed factory overhead allocated 5.00 Total costs $21.00 The above per unit costs are based on 8,000 units. An outside supplier will provide 8,000 subassemblies for $19 per unit. The supervisor will be terminated if the subassemblies are not produced in house. The idle factory will be used to manufacture…
IronBallon Co.makes two beverages: ZIPA and Zager. The following data is summarized: Cost ZIPA Zager Direct materials cost per unit $490 $2,010 Direct labor cost per unit $560 $120 Indirect manufacturing cost per unit ? ? Indirect manufacturing cost information includes the following: Activity Predetermined Overhead Allocation Rate ZIPA Zager Setup $1,210.00 45 Per setup 85 Per setup Machine maintenance $17.00 1,210 Per MHr 3,740 Per MHr IronBallon Co. plans to produce 290 units of each product.(Round your answers to two decimal places when needed and use rounded answers for all future calculations).1. Compute the ABC indirect manufacturing cost per unit for each product. ZIPA Predetermined Overhead Allocation Rate X Actual Quantity of the Allocation Base Used = Actual Manufacturing Overhead Cost Setup X = Machine Maintenance X = Total Estimated Overhead Costs Number of products Manufacturing overhead…
Division X of Bella Corporation sells Part A to other companies for $87.20 per unit. According to the company's accounting system, the costs to Division X to make a unit of Part A are: O $87.20 per unit O $62.60 per unit O $58.10 per unit O $79.95 per unit O None of the above Direct materials Direct labor $5.80 Variable Division Y of Bella Corporation uses a part much like Part A in one of its products. Division Y can buy this part from an outside supplier for $79.95 per unit. However, Division Y could use Part A instead of the part it purchases from the outside supplier. What is the most Division Y would be willing to pay the Division X for Part A? Question 21 $42.70 manufacturing $9.60 overhead Fixed manufacturing $4.50 overhead
Vattes, Incorporated, manufactures and sells two products: Product 15 and Product U1. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Product 15 Product U1 Direct Labor- Expected Hours Per Production Unit 700 7.0 200 4.0 Activity Cost Pools Labor-related Machine setups Order size Product 15 Product U1 Total direct labor-hours The direct labor rate is $22.00 per DLH. The direct materials cost per unit for each product is given below: Direct Materials Cost per Unit $ 261.60 $ 121.60 Activity Measures DLHS setups MHS The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity, Expected Activity Total Direct Labor- Estimated Overhead Cost $ 268,698 Hours 4,900 800 5,700 37,324 633,895 $939,917 Product 15 Product U1 4,900 300 4,900 800 400 4,800 Total 5,700 700 9,700