McBride and Associates employs two professional appraisers, each having a different specialty. Debbie specializes in commercialappraisals and Tara specializes in residential appraisals. The company expects to incur total overhead costs of $394,200 during theyear and applies overhead based on annual salary costs. The salaries and billable hours of the two appraisers are estimated to be asfollows:Debbie$173,8802,300TaraAnnual Salary$88,9201,950Billable HoursThe accountant for McBride and Associates is computing the hourly rate that should be used to charge clients for Debbie and Tara'sservices. The hourly billing rate should be set to cover the total cost of services (salary plus overhead) plus a 20 percent markup.Required:1. Compute the predetermined overhead rate.2. Compute the hourly billing rate for Debbie and Tara.

Predetermined Overhead Rate (Based on Salary Costs) = Total Overhead / Total Salary Hourly Billing…

Answered: Required: 1. Compute the predetermined…

Business

Accounting

Required: 1. Compute the predetermined overhead rate. 2. Compute the hourly billing rate for Debbie and Tara.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: omplete the job cost sheet for Job Alpha. (Round your intermediate calculations to 2 decimal…

A: Direct Materials Cost: This represents the cost of raw materials directly used in Job…

Q: 7. The entry to record the purchase of materials using a job costing system would include Ocredit to…

A: The question is based on the concept of Cost Accounting. Job costing is used in manufacturing entity…

Q: Calculate the overhead cost assigned to the job if the company used the overhead rates developed in…

A: Total overhead cost (step down method) $84,522Total overhead cost (Direct method)…

Q: rder costing systefi tnd Cosing Multiple Choice O Apply overhead cost to jobs by multiplying a…

A: Solution: A job order costing system that relies on normal costing will "Assign actual direct…

Q: How can the predetermined factory overhead rate be used in job order cost accounting to assist…

A: Factory overheads refer to the total cost of manufacturing and operating a manufacturing process, is…

Q: Under a job order costing system, individual jobs are allocated an estimated amount of overhead…

A: Overhead means the cost incurred indirect in factory for the production of goods. Manufacturing…

Q: The ________ is the hourly price charged to clients for professional labor. salary rate billing rate…

A: Professional labour is that labour which provides professional services to another person for a…

Q: In a job-order costing system, direct labor cost is usually recorded as a credit to: O a. Cash or…

A: Introduction: Journals: Recording of a business transactions in a chronological order. Firsts step…

Q: A cost driver is used to allocate support department expenses. Match each of the following cost…

A: Cost driver is the units on which the total costs are allocated or distributed. It shows the cost…

Q: Requirement 3. Prepare the journal entry transferring Job M1 to finished goods. (Record debits…

A: For job M1 As calculated in req : 2 • Direct materials $78,000 •Direct manufacturing labor…

Q: cturing Overhead. credit to job cost sh

A: Overhead application is recorded with a . Credit to Manufacturing Overhead

Q: Problem 3-19 (Algo) Multiple Predetermined Overhead Rates; Applying Overhead [LO3-1, LO3-2, LO3-4]…

A: Introduction:The overhead rate is a cost that is allocated to the product or service at the time of…

Q: Information about which of the following items is not covered on a job cost sheet? Multiple Choice…

A: the job cost sheet is a complete sheet that is prepared by the factory accountant for every job that…

Q: Discuss how the predetermined factory overhead rate can be used in job order cost accounting to…

A: Predetermined overhead means the budgeted indirect factory costs which are incurred in the…

Q: Which of the following statements are true? I. In a job-order costing system, indirect labor is…

A: Notes : The expense of manufacturing each product is calculated using the job order technique of…

Q: $ 91,300 Harbour Company makes two models of electronic tablets, the Home and the Work. Basic…

A: The question is related to Traditional method and Activity Based Costing. The details of two…

Q: Please explain:: What is the purpose of an overhead rate What are the steps to apply the overhead…

A: Requirement 1: The overhead rate is used to allocate the indirect cost to the direct costs being…

Q: In a job order system, the ending Work in Process acco A.) the Pokémon from all nine regions B.) all…

A: A job order system is a method of cost accounting used by companies that produce unique, custom-made…

Q: Need Correct answer please provide it

A: Here's an explanation of each option: A. This is the correct answer. A job cost sheet is a detailed…

Q: How to solve the factory overhead rate of 2/3 of the labor cost?

A: Lets understand the basics.Factory overhead is a all indirect cost incurred for the production of…

Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

McBride and Associates employs two professional appraisers, each having a different specialty. Debbie specializes in commercial
appraisals and Tara specializes in residential appraisals. The company expects to incur total overhead costs of $394,200 during the
year and applies overhead based on annual salary costs. The salaries and billable hours of the two appraisers are estimated to be as
follows:
Debbie
$173,880
2,300
Tara
Annual Salary
$88,920
1,950
Billable Hours
The accountant for McBride and Associates is computing the hourly rate that should be used to charge clients for Debbie and Tara's
services. The hourly billing rate should be set to cover the total cost of services (salary plus overhead) plus a 20 percent markup.
Required:
1. Compute the predetermined overhead rate.
2. Compute the hourly billing rate for Debbie and Tara.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Which of the following statements is true? (You may select more than one answer.)a. The Manufacturing Overhead account is debited when manufacturing overhead isapplied to Work in Process.b. Job cost sheets accumulate the actual overhead costs incurred to complete a job.c. When products are transferred from work in process to finished goods it results ina debit to Finished Goods and a credit to Work in Process.d. Selling expenses are applied to production using a predetermined overhead ratethat is computed at the beginning of the period.
Jackson Foundry uses a predetermined overhead allocation rate to allocate overhead to individual jobs, based on the machine hours required. (Click the icon to view the costs.) Requirements 1. 2. 3. Compute Jackson's predetermined overhead allocation rate. Prepare the journal entry to allocate manufacturing overhead. Post the manufacturing overhead transactions to the Manufacturing Overhead T-account. Is manufacturing overhead underallocated or overallocated? By how much? 4. Prepare the journal entry to adjust for the underallocated or overallocated manufacturing overhead. Does your entry increase or decrease Cost of Goods Sold? Print Allocated overhead to WIP Done - X Data table At the beginning of 2024, the company expected to incur the following: Manufacturing overhead costs Direct labor costs $880,000 1,540,000 Machine hours 80,000 hours At the end of 2024, the company had actually incurred: Direct labor costs Depreciation on manufacturing plant and equipment Property taxes on plant…
Which one of the following best describes a job cost sheet? A. It is a form used to record the costs chargeable to a specific job and to determine the total and unit costs of the completed job. B. It is used to track manufacturing overhead costs for specific jobs. C. It is used by management to understand how direct costs affect profitability. D. It is a daily form that management uses for tracking worker productivity on which employee raises are based.
A cost driver is used to allocate support department expenses. Match each of the following cost drivers with the appropriate department. Clear All Number of work orders Number of employees Number of payroll checks Number of purchase requisitions Payroll Accounting Maintenance President's Office Purchasing Human Resources
The cost accountant prepares the cost of production summary by first collecting the period’s production costs from summaries of material requisitions, payroll, and factory overhead analysis sheets. True or False?
The job-order cost sheet accumulates the cost of all the jobs produced. True O False
In the Excel, or spreadsheet, approach to recording financial transactions, the Manufacturing Overhead account is used to record two things-all actual overhead expenses and the amount of manufacturing overhead applied to production using the predetermined overhead rate. True or False True False
a. REQUIREMENTS #2 and #3 ONLY of Exercise 4-49 (picture 2). Assume Direct Labor workers make $20 per hour, so with the given labor cost per job, you can determine the number of hours worked. CHANGE the Exercise to say that Overhead is applied at the rate of $32 per direct labor hour. ALSO CHANGE to say that Job #39 and Job #40 were completed and sold, while Job #41 and Job #42 are complete but not sold, and Job #43 is not completed yet. b. Use the information in Problem 4-53 (picture 2) to prepare journal entries for the month of July with the following CHANGES. First, assume that the company uses a plantwide overhead rate based on direct labor dollars. Also assume that estimated information for the year includes Direct labor dollars of $1,642,000. Finally, assume that the company sells its jobs at a selling price equal to (cost + 25% of cost markup).
Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare thenecessary journal entry.
How to calculate a the amount of balance in a job costs sheet