Splunge Manufacturing produces surfboards. The company uses a normal-costing system and allocates manufacturing overhead on the basis of direct manufacturing labor-hours. Most of the company's production and sales occur in the first and second quarters of the year. The company is in danger of losing one of its larger customers, Soho Wholesale, due to large fluctuations in price. The owner of Splunge has requested an analysis of the manufacturing cost per unit in the second and third quarters. You have been provided the following budgeted information for the coming year. E (Click the icon to view the budgeted information.) (Click the icon to view additional information.) Read the requirements Requirement 1 and 2. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter and an annual budgeted manufacturing overhead rate. First identify the formula to calculate the total manufacturing cost per unit, then enter the appropriate amounts to calculate the total cost per unit for second and third quarter based on the budgeted manufacturing overhead rate determined for each quarter and an annual budgeted manufacturing overhead rate for the year. (Abbreviation used: OH = overhead, mat. = materials, and Var. = variable.) Total cost Direct labor per unit Direct mat. per unit Fixed OH per unit Var. OH per unit per unit Qtr 2 Qtr 3 - X - X More Info Data Table Annual It takes 1 direct manufacturing labor-hour to make each board. The actual direct material cost is S$15.00 per board. The actual direct manufacturing labor rate is $29 per hour. The budgeted variable manufacturing overhead rate is $22 per direct manufacturing labor-hour. Budgeted fixed manufacturing overhead costs are $15,000 each quarter. Quarter 2 3 4 Surfboards manufactured and sold 965 750 375 310
Splunge Manufacturing produces surfboards. The company uses a normal-costing system and allocates manufacturing overhead on the basis of direct manufacturing labor-hours. Most of the company's production and sales occur in the first and second quarters of the year. The company is in danger of losing one of its larger customers, Soho Wholesale, due to large fluctuations in price. The owner of Splunge has requested an analysis of the manufacturing cost per unit in the second and third quarters. You have been provided the following budgeted information for the coming year. E (Click the icon to view the budgeted information.) (Click the icon to view additional information.) Read the requirements Requirement 1 and 2. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter and an annual budgeted manufacturing overhead rate. First identify the formula to calculate the total manufacturing cost per unit, then enter the appropriate amounts to calculate the total cost per unit for second and third quarter based on the budgeted manufacturing overhead rate determined for each quarter and an annual budgeted manufacturing overhead rate for the year. (Abbreviation used: OH = overhead, mat. = materials, and Var. = variable.) Total cost Direct labor per unit Direct mat. per unit Fixed OH per unit Var. OH per unit per unit Qtr 2 Qtr 3 - X - X More Info Data Table Annual It takes 1 direct manufacturing labor-hour to make each board. The actual direct material cost is S$15.00 per board. The actual direct manufacturing labor rate is $29 per hour. The budgeted variable manufacturing overhead rate is $22 per direct manufacturing labor-hour. Budgeted fixed manufacturing overhead costs are $15,000 each quarter. Quarter 2 3 4 Surfboards manufactured and sold 965 750 375 310
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Splunge Manufacturing produces surfboards. The company uses a normal-costing system and allocates manufacturing overhead on the basis of direct manufacturing labor-hours. Most of the company's production and sales occur in the first and second
quarters of the year. The company is in danger of losing one of its larger customers, Soho Wholesale, due to large fluctuations in price. The owner of Splunge has requested an analysis of the manufacturing cost per unit in the second and third quarters. You
have been provided the following budgeted information for the coming year:
E (Click the icon to view the budgeted information.)
A (Click the icon to view additional information.)
Read the requirements
Requirement 1 and 2. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter and an
annual budgeted manufacturing overhead rate.
First identify the formula
an annual budgeted manufacturing overhead rate for the year. (Abbreviation used: OH = overhead, mat. = materials, and Var. = variable.)
calculate the total manufacturing cost per unit, then enter the appropriate amounts to calculate the total cost per unit for second and third quarter based on the budgeted manufacturing overhead rate determined for each quarter and
Total cost
Direct labor per unit
Direct mat. per unit
Fixed OH per unit
Var. OH per unit
per unit
Qtr 2
Qtr 3
More Info
Data Table
Annual
It takes 1 direct manufacturing labor-hour to make each board. The actual direct
material cost is $15.00 per board. The actual direct manufacturing labor rate is
$29 per hour. The budgeted variable manufacturing overhead rate is $22 per direct
manufacturing labor-hour. Budgeted fixed manufacturing overhead costs are
$15,000 each quarter.
Quarter
1
2
3
4
Surfboards manufactured and sold
965
750
375
310
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