Silver stream Pumps, Inc. manufactures pumps for agricultural irrigation systems. For the year, management estimated that the total manufacturing overhead would be $1,200,000. Management decided to use direct labor hours to apply manufacturing overhead and budgeted 50,000 direct labor hours. The balance in over- or under-applied overhead is deemed to be small. The following information was compiled before an adjustment had been made to close Manufacturing Overhead Control: Information Raw Materials Inventory Work in Process Inventory Amount ($) 250,000 210,000 Finished Goods Inventory 520,000 Actual Direct Labor Hours Used 55,000 Actual Overhead Incurred 1,150,000 For the year, manufacturing overhead was: A. $150,000 under-applied B. $150,000 over-applied C. $170,000 over-applied D. $170,000 under-applied

Silver stream Pumps, Inc. manufactures pumps for agricultural irrigation systems. For the year, management estimated that the total manufacturing overhead would be $1,200,000. Management decided to use direct labor hours to apply manufacturing overhead and budgeted 50,000 direct labor hours. The balance in over- or under-applied overhead is deemed to be small. The following information was compiled before an adjustment had been made to close Manufacturing Overhead Control: Information Raw Materials Inventory Work in Process Inventory Amount ($) 250,000 210,000 Finished Goods Inventory 520,000 Actual Direct Labor Hours Used 55,000 Actual Overhead Incurred 1,150,000 For the year, manufacturing overhead was: A. $150,000 under-applied B. $150,000 over-applied C. $170,000 over-applied D. $170,000 under-applied

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter18: Pricing And Profitability Analysis

Section: Chapter Questions

Problem 15E: Flaherty, Inc., has just completed its first year of operations. The unit costs on a normal costing...

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When setting its predetermined overhead application race, Tasty Box Meals estimated its overhead would be $100,000 and would require 25,000 machine hours in the next year. At the end of the year. It found that actual overhead was $102,000 and required 26,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under applied or over applied overhead.
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Swifty Manufacturing produces industrial light fixtures. For the year, management estimated that total manufacturing overhead would be $ 1120000. Management decided to use direct labor hours to apply manufacturing overhead and budgeted 144700 direct labor hours. The following information was compiled before an adjustment had been made to close Manufacturing Overhead Control: Raw Materials Inventory $ 124300 Workin Process Inventory 464170 Finished Goods Inventory 432820 Cost of Goods Sold 2340000 For the year, manufacturing overhead was overapplied by $ 334000. If Swifty prorates the overapplied overhead, what is the ending balance of Cost of Goods Sold? (Round intermediate calculations to 4 decimal places.)
The management of Garn Corporation would like to investigate the possibility of basing its predetermined overhead rate on activity at capacity rather than on the estimated activity for the coming year. The Corporation's controller has provided an example to illustrate how this new system would work. In this example, the allocation base is machine-hours and the estimated activity for the upcoming year is 69,000 machine-hours. Capacity is 85,000 machine-hours. AlIl of the manufacturing overhead is fixed and is $4,105,500 per year within the range of 69,000 to 85,000 machine-hours. If the Corporation bases its predetermined overhead rate on capacity but the actual level of activity for the year turns out to be 69,700 machine-hours, the cost of unused capacity shown on the income statement prepared for internal management purposes would be closest to: Multiple Choice $772,800 $780,640 $738,990 $41,650
The management of Garn Corporation would like to investigate the possibility of basing its predetermined overhead rate on activity at capacity rather than on the estimated activity for the coming year. The Corporation's controller has provided an example to illustrate how this new system would work. In this example, the allocation base is machine-hours and the estimated activity for the upcoming year is 59,400 machine-hours. Capacity is 78,400 machine-hours. All of the manufacturing overhead is fixed and is $3,136,000 per year within the range of 59,400 to 78,400 machine-hours. If the Corporation bases its predetermined overhead rate on capacity but the actual level of activity for the year turns out to be 59,900 machine-hours, the cost of unused capacity shown on the income statement prepared for internal management purposes would be closest to: Multiple Choice $26.177 $766,177 $740,000 $26,397
Which of the following choice is the correct status of manufacturing overhead at year end ?.
The manager at Screaming Trees has been trying to calculate the portion of the company's overhead expenses that is fixed and the portion that is variable. Over the past twelve months, the number of yards of mulch processed was highest in July, when the total monthly overhead costs totaled $32,000 for 37,000 yards of mulch processed. The lowest number of yards of mulch processed in the last twelve months occurred in October, when total overhead costs were $26,000 for 26,000 yards of mulch processed. What was the variable cost per yard? OA. $1.00 O B. $1.83 O C. $0.55 O D. $0.86