Shannon Corporation manufactures custom cabinets for kitchens. It uses a normal-costing system with two direct-cost categories-direct materials and direct manufacturing labor-and one indirect-cost pool, manufacturing overhead costs. It provides the following information for 2020: (Click the icon to view the information for 2020.) Read the requirement. Begin by calculating the budgeted indirect cost rate. Select the formula and then calculate the rate. (Assume the cost allocation base is direct labor hours.) + + Data table Budgeted manufacturing overhead costs $ Budgeted direct manufacturing labor-hours Actual manufacturing overhead costs Actual direct manufacturing labor-hours $ = Budgeted indirect cost rate = 1,024,000 32,000 hours 1,302,000 31,000 hours X

Shannon Corporation manufactures custom cabinets for kitchens. It uses a normal-costing system with two direct-cost categories-direct materials and direct manufacturing labor-and one indirect-cost pool, manufacturing overhead costs. It provides the following information for 2020: (Click the icon to view the information for 2020.) Read the requirement. Begin by calculating the budgeted indirect cost rate. Select the formula and then calculate the rate. (Assume the cost allocation base is direct labor hours.) + + Data table Budgeted manufacturing overhead costs $ Budgeted direct manufacturing labor-hours Actual manufacturing overhead costs Actual direct manufacturing labor-hours $ = Budgeted indirect cost rate = 1,024,000 32,000 hours 1,302,000 31,000 hours X

Name: Shannon Corporation manufactures custom cabinets for kitchens. It use
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Description: Shannon Corporation manufactures custom cabinets for kitchens. It uses a normal-costing system with two direct-cost categories-directmaterials and direct manufacturing labor-and one indirect-cost pool, manufacturing overhead costs. It provides the f

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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Consider the following data for two products of Vigano Manufacturing. Budgeted Cost Activity Machine setup Parts handling Quality inspections Total budgeted overhead Unit Information Units produced Direct materials cost Direct labor cost Direct labor hours Actual Activity Usage Setups Parts Inspections 1. Using a plantwide overhead rate based on 6,500 direct labor hours, compute the total product cost per unit for each product. 2. Consider the following additional information about these two products. If activity- based costing is used to allocate overhead cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Required 1 Required 2 Per Unit Product A Product B Activity Driver $ 26,000 (20 machine setups) 20,800 (16,000 parts) 31,200 (100 inspections) $ 78,000 Product A 2,600 units $36 per unit $ 56 per unit 2 per unit $ Direct Materials Complete this…
Carica Company is a manufacturer with two production departments (Machining and Assembly) as well as two support departments (Materials Requisitions and Utility Services). For the last quarter of 2020, Carica's cost records indicate the following: SUPPORT PRODUCTION \table[[, \table[[Materials], [Requisitions], [(MR)]], \table [[Utility], [Services], [(US )]], Machining, Assembly, Total], [\table [[Budgeted], [overhead costs], [before any inter-], [department cost], [allocations]], $200,000, $1,000,000, $5, 456, 000, $7,458, 000, $14, 114,000 Required: 1. Allocate the two support departments 'costs to the two operating departments using the following methods: a. Direct method b. Step-down method ( allocate MR first) c. Step-down method (allocate US first) d. The Algebraic method. 2. Compare and explain differences in the support - department costs allocated to each production department. 3. What approaches might be used to decide the sequence in which to allocate support departments…
Michael Roberts is a cost accountant and business analyst for HP Clothing Company (HPCC), which manufactures expensive T-shirts. HPCC uses two direct cost categories: direct materials and direct manufacturing labor. It allocates manufacturing overhead to production based upon labor hours used. At the beginning of 2020, HPCC adopted the following standards for each T-shirt: Standard Quantity Standard Price Or Hour 3.1 kg 2 hours 2 hours Or Rate $9 /kg $8/hour Input Direct materials Direct labor Variable overhead $5 /hour Actual results for April 2020 were as follows: Production 3,200 T-shirts Direct materials purchased Direct materials used 12,900 kg. at S10 kg 9,000 kg 7,200 hours for $59,000 Direct labor Variable manufacturing overhead $ 35,600 Required: a) Compute the standard variable product cost per unit. b) For the month of April 2020, compute the following variances, indicating whether each is favorable or unfavorable: i. Direct materials price variance, based on purchases ii.…
Oakwood Creations Company makes decorative candle pedestals. An industrial engineer consultant developed ideal time standards for one unit of the Berkley model pedestal. The standards follow, along with the cost accountant's determination of current labor pay rates: Worktype 1 Worktype 2 Worktype 3 0.18 hour @ $12.31 per hour 0.32 hour @ $10.89 per hour 0.62 hour @ $19.65 per hour Required: a. Using the preceding data, calculate the direct labor cost for a Berkley model pedestal. b. Would it be appropriate to use the cost calculated in part a as a standard cost for evaluating direct labor performance and valuing inventory? Complete this question by entering your answers in the tabs below. Required A Required B Would it be appropriate to use the cost calculated in part a as a standard cost for evaluating direct labor performance and valuing inventory? Would it be appropriate to use the cost calculated in part a as a standard cost for evaluating direct labor performance and valuing…
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If Toyota Motor Company receives an order on May 1, begins production on May 19, and ships the order on May 24 immediately following production, then what is the manufacturing cycle efficiency (MCE) ratio? (Enter your answer as a whole number.) Manufacturing cycle efficiency (MCE)atio %
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Clara Corporation manufactures custom cabinets for kitchens. It uses a normal-costing system with two direct cost categories-direct materials and direct manufacturing labor-and one indirect-cost pool, manufacturing overhead costs. View the manufacturing overhead costs information for 2020. View the other information available as of December 31, 2020. Requirement Calculate the underallocated or overallocated manufacturing overhead at the end of 2020 and prorate it to Work-in-Process Control, Finished Goods Control, and Cost of Goods Sold accounts based on the allocated manufacturing overhead in each account balance using normal costing. Begin by calculating the budgeted indirect cost rate. Identify the formula and then calculate the rate. (Assume the cost allocation base is direct labor hours.) Budgeted indirect cost rate + Manufacturing Overhead Costs Budgeted manufacturing overhead costs Budgeted direct manufacturing labor hours Actual manufacturing overhead costs Actual direct…
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