Laval produces lamps and home lighting fixtures. Its most popular product is a brushed aluminum desk lamp. Thislamp is made from components shaped in the fabricating department and assembled in the assembly department.Information related to the 33,000 desk lamps produced annually follows.Direct materialsDirect laborFabricating department (7,500 DLH × $23 per DLH)Assembly department (15,400 DLH × $20 per DLH)Machine hoursFabricating departmentAssembly departmentDirect labor hours.Machine hoursOverhead costExpected overhead cost and related data for the two production departments follow.Fabricating130,000 DLH162,000 MH$360,000Assembly280,000 DLH129,000 MH$445,000$260,000$172,500$308,00015,200 MH21,200 MHRequired1. Determine the plantwide overhead rate for Laval using direct labor hours as a base.2. Determine the total manufacturing cost per unit for the aluminum desk lamp using the plantwide overhead rate.3. Compute departmental overhead rates based on machine hours in the fabricating department and direct laborhours in the assembly department.4. Use departmental overhead rates from requirement 3 to determine the total manufacturing cost per unit for thealuminum desk lamps.Complete this question by entering your answers in the tabs below.Required 4Required 1 Required 2 Required 3Determine the plantwide overhead rate for Laval using direct labor hours as a base.< Required 1Required 2 >

Manufacturing cost -is the cost of manufacturing or producing the products or services and includes…

Required 1. Determine the plantwide overhead rate for Laval using direct labor hours as a base. 2. Determine the total manufacturing cost per unit for the aluminum desk lamp using the plantwide overhead rate. 3. Compute departmental overhead rates based on machine hours in the fabricating department and direct labor hours in the assembly department. 4. Use departmental overhead rates from requirement 3 to determine the total manufacturing cost per unit for the aluminum desk lamps.

Required 1. Determine the plantwide overhead rate for Laval using direct labor hours as a base. 2. Determine the total manufacturing cost per unit for the aluminum desk lamp using the plantwide overhead rate. 3. Compute departmental overhead rates based on machine hours in the fabricating department and direct labor hours in the assembly department. 4. Use departmental overhead rates from requirement 3 to determine the total manufacturing cost per unit for the aluminum desk lamps.

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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The following is taken from Clausen Company's internal records of its factory with two operating departments. The cost driver for indirect labor is direct labor hours, and the cost driver for the remaining items is number of hours of machine use. Compute the total amount of rent and utilities allocated to Dept. 2 using activity-based costing. Direct LaborHours MachineHours Operating Dept. 1 864 9,300 Operating Dept. 2 2,016 6,200 Totals 2,880 15,500 Factory overhead costs Rent and utilities $ 20,700 Indirect labor 16,300 Depreciation – Equipment 13,000 Total factory overhead $ 50,000
Equivalent Units of Production and Cost per Equivalent Unit—FIFO Method Required: Assume that the company uses the FIFO method in its process costing system. 1. Compute the first department’s equivalent units of production for materials, labor, and overhead for the month. 2. Compute the first department’s cost per equivalent unit for materials, labor, overhead, and in total for the month.
Single Plantwide and Multiple Production Department Factory Overhead Rate Methods and Product Cost Distortion The management of Nova Industries Inc. manufactures gasoline and diesel engines through two production departments, Fabrication and Assembly. Management needs accurate product cost information in order to guide product strategy. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering the multiple production department factory overhead rate method. The following factory overhead was budgeted for Nova: $765,000 315,000 $1,080,000 Fabrication Department factory overhead Assembly Department factory overhead Total Direct labor hours were estimated as follows: Fabrication Department Assembly Department Total In addition, the direct labor hours (dlh) used to produce a unit of each product in each department were determined from engineering records, as follows: Production Departments…
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 G-09 19,400 $7 4 144 Machine depreciation Setup labor Materials handling Total Production at the plant is automated and any labor cost is included in overhead. Data on manufacturing overhead at the plant follow: G-35 3,880 $ 19 7 72 $184,760 52,380 41,904 $ 199,044 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. Compute the cost driver rates for the proposed system at Heidelberg.
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Assigning indirect costs to departments is completed by ________. applying the predetermined overhead rate debiting the manufacturing costs incurred applying the costs to manufacturing overhead applying the costs to work in process inventory In a process costing system, which account shows the overhead assigned to the department? cost of goods sold • finished goods inventory raw material inventory work in process inventory A print shop produces custom paintings. It has received four different orders (a/B/C/D) The total cost for the four orders is labor $6000, materials $10,000 and overheads for 5,000. What processes/systems would you implement if you wanted to know the cost for each of the orders which are not similar.
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10. How much manufacturing overhead was applied from the Molding Department to Job P and how much was applied to Job Q? 11. How much manufacturing overhead was applied from the Fabrication Department to Job P and how much was applied to Job Q? 12. If Job P includes 20 units, what is its unit product cost?
4.2 BriteLite Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated activity costs and activity bases are as follows:
Problem 3-19 (Algo) Multiple Predetermined Overhead Rates; Applying Overhead [LO3-1, LO3-2, LO3-4] High Desert Potteryworks makes a variety of pottery products that it sells to retailers. The company uses a job-order costing system in which departmental predetermined overhead rates are used to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Molding Department is based on machine-hours, and the rate in the Painting Department is based on direct labor- hours. At the beginning of the year, the company provided the following estimates: Department Molding Painting 33,500 53,300 85,000 35,000 $212,500 $463, 710 $ 3.00 $ 5.00 Direct labor-hours Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Job 205 was started on August 1 and completed on August 10. The company's cost records show the following information concerning the job: Direct labor-hours…
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