Spud, Inc. a manufacturer of gourmet potato chips, employs activity-based costing. The budgeted data for each of the activity cost pools is provided below for the year 2017. Estimated Overhead Expected Use of Cost Drivers per Activity Activity Cost Pools Ordering and receiving $73,800 12,000 orders Food processing 420,750 55,000 machine hours Packaging 1,365,000 420,000 labor hours For 2017, the company had 10,000 orders and used 48,000 machine hours, and labor hours totaled 490,000. Calculate the overhead rates for each activity. (Round answers to 2 decimal places, e.g. 12.25.) Overhead Rates Ordering and receiving per order %24 Food processing per machine hour 2$ Packaging per labor hour LINK TO TEXT INTERACTIVE TUTORIAL What is the total overhead applied? Total overhead applied

Spud, Inc. a manufacturer of gourmet potato chips, employs activity-based costing. The budgeted data for each of the activity cost pools is provided below for the year 2017. Estimated Overhead Expected Use of Cost Drivers per Activity Activity Cost Pools Ordering and receiving $73,800 12,000 orders Food processing 420,750 55,000 machine hours Packaging 1,365,000 420,000 labor hours For 2017, the company had 10,000 orders and used 48,000 machine hours, and labor hours totaled 490,000. Calculate the overhead rates for each activity. (Round answers to 2 decimal places, e.g. 12.25.) Overhead Rates Ordering and receiving per order %24 Food processing per machine hour 2$ Packaging per labor hour LINK TO TEXT INTERACTIVE TUTORIAL What is the total overhead applied? Total overhead applied

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: Variable costs: Factory supplies $100,000 Indirect labor 152,000 Utilities…

A: Variable overheads are the costs that vary on the basis of production whereas fixed costs remain…

Q: Middler Corporation, a manufacturer of electronics and communications systems, uses a service…

A: Activity Rate = Budgeted CostBudgeted Activity

Q: A manufacturer has the following budgeted data for its two production departments: Budgeted Data…

A: The objective of the question is to verify if the given overhead rate for the Assembly department,…

Q: Scrumptious Snacks Inc. manufactures three types of snack foods: tortilla chips, potato chips, and…

A: Factory overhead is the indirect cost incurred by factory for the production of goods. Indirect cost…

Q: 5) Turner, Inc. budgeted 10,000 widgets for production during 2016. Turner has capacity to produce…

A: Budgets that are static are designed for one level of activity. When the projected and actual levels…

Q: Speier Company estimates that 240,000 direct labor hours will be worked during 2017 in the Assembly…

A: Given data: Number of budgeted direct labour hours = 240,000 Indirect Labor = $72,000 Indirect…

Q: The manufacturing overhead budget for Pina Colada Company contains the following items. Variable…

A: A budget is a forecast of revenue and expenses for a certain future period of time that is generally…

Q: Pronghorn Company estimates that 312,000 direct labor hours will be worked during the coming year,…

A: Solution:-The task involves creating a monthly manufacturing overhead flexible budget for every…

Q: Over and Under, Inc. manufactures weaving looms. Before the period began, the company prepared the…

A: Variance analysis is the process of comparing the actual data with the estimated data. It helps in…

Q: Ocean Sails manufactures sailing boats in two models: the Wave Rider and the Stress Killer. The…

A: SOLUTION VARIABLE COST IS A CORPORATE EXPENSES THAT CHANGES IN PROPORTION TO HOW MUCH A COMPANY…

Q: Arsons company is planning to produce 2,100 units of product in 2017. Each unit requires 1.60 pounds…

A: Step 1: Introduction to Production Budget and Standard Unit Cost:A manufacturing firm usually…

Q: Ayayai Company estimates that 240.000 direct labor hours will be worked during the coming year.…

A: Variable costs are costs that varies with the change in the level of output whereas fixed costs are…

Q: Jackson Inc. listed the following data for 2016: Budgeted factory overhead $1,271,000 Budgeted…

Q: ig over Variable costs Indirect materials Indirect labor Maintenance expense Manufacturing supplies…

A: The manufacturing overhead budget is prepared to compare the indirect costs of production. The…

Q: industhes, thc. (Gi), developed standard Costs for dired Gll estimated thế föllowing ständard costs…

A: Direct materials: Direct materials are one of the component which is required in manufacturing of a…

Q: ndirect labor 24,000 Utilities 20,000 Maintenance 12,000 Fixed Costs Supervisor’s salary…

A: Budgeted Actual Difference { F / U } Variable Costs Indirect materials $40,000 $37,200…

Q: Deluxe, Inc. uses a standard cost system and provides the following information. (Click the icon to…

A: It is important for project managers to monitor and track cost variances closely, and to take…

Q: he total factory overhead for Diva-nation is budgeted for the year at $180,000, divided into four…

A: Factory Overhead: These are the manufacturing expenditure incurred in the production of goods that…

Q: Prepare a manufacturing overhead budget for the year. de E21-11 Atlanta Company is preparing its…

A: A financial plan that projects and allots indirect manufacturing costs for a given time frame is…

Q: Better Products Company manufactures insulation and applies manufacturing overhead costs to…

A: Manufacturing Overhead costs are Indirect manufacturing expenses that are incurred in relation to…

Q: The Meyers CPA firm has the following overhead budget for the year: Overhead Indirect materials…

A: Pre-determined overhead rates are used to allocate the manufacturing overheads. It can be allocated…

Q: $30,299

A: Cost for each kilometer = $2631 / 1,495,000 kms= $0.00176 for each kilometerNow,For 138 orders =…

Q: Rose Company uses a flexible budget for manufacturing overhead based on direct labor hours. The…

A: A budget is a forecast of revenue and expenses for a certain future period of time that is generally…

Q: Ocean Sails manufactures sailing boats in two models: the Wave Rider and the Stress Killer. The…

A: Absorption costing is the method of income statement where all the costs associated with the…

Q: Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced.…

A: Journal entry refers to recording and classifying business transactions into books of accounts…

Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

100%

Spud, Inc. a manufacturer of gourmet potato chips, employs activity-based costing. The budgeted data for each of the activity cost pools is provided below for the year 2017.
Estimated
Overhead
Expected Use of
Cost Drivers per Activity
Activity Cost Pools
Ordering and receiving
$73,800
12,000 orders
Food processing
420,750
55,000 machine hours
Packaging
1,365,000
420,000 labor hours
For 2017, the company had 10,000 orders and used 48,000 machine hours, and labor hours totaled 490,000.
Calculate the overhead rates for each activity. (Round answers to 2 decimal places, e.g. 12.25.)
Overhead Rates
Ordering and receiving
per order
%24
Food processing
per machine hour
2$
Packaging
per labor hour
LINK TO TEXT
INTERACTIVE TUTORIAL
What is the total overhead applied?
Total overhead applied

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 with 2 images

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

please explain thanks
Melissa Jones is manager of a production department of Seal Company. Her department makes one product; the following information for her department was accumulated for 2014: Static Budget Actual Results Number of units 100,000 91,000 Direct materials cost 400,000 350,000 Direct Labor cost 200,000 180,000 Variable manufacturing overhead 100,000 97,000 Fixed manufacturing overhead 145,000 146,000 Total $845,000 $773,000 Required: 1)Using the table below, prepare a flexible budget for the department's actual level of activity. 2) Using the table below, use the flexible budget to evaluate the performance of Ms. Jones' department. 3) Why does the budget not include sales revenue and net income? Flexible Budget Actual Results Variance Number of units Direct materials cost Direct labor cost Variable manufacturing overhead Fixed manufacturing overhead Total
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Its Production Department's planning budget and flexible budget are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Direct labor Indirect labor Utilities Supplies Equipment depreciation Cost Formulas $16.309 $4,200+ $1.809 $5,800+ $0.909 $1,800+ $0.109 The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below: Factory rent Property taxes Factory administration $18,600 + $2.609 $8,100 $2,800 $13,300 + $0.709 Actual Cost Incurred in March $ 66,780 $ 10,940 $ 9,970 $ 2,430 $ 29,000 $ 8,500 $ 2,800 $ 15,470 Required: 1. Prepare the Production Department's planning budget for the month.
King Whiz manufactures premium food processors. The following are some manufacturing overhead data for King Whiz for the year ended December 31, 2017: Manufacturing Overhead Actual Results Flexible Budget Allocated Amount Variable $41,861 $74,646 $74,646 Fixed 350,225 349,200 376,300 Budgeted number of output units: 600 Planned allocation rate: 3 machine-hours per unit Actual number of machine-hours used: 1,021 Static-budget variable manufacturing overhead costs: $70,200 Compute the following quantities (you should be able to do so in the prescribed order): 1. Budgeted number of machine-hours planned 2. Budgeted fixed manufacturing overhead costs per machine-hour 3. Budgeted variable manufacturing overhead costs per machine-hour 4. Budgeted number of machine-hours allowed for actual output produced 5. Actual number of output units 6. Actual number of machine-hours used per output unit
Shalom Company prepared its 2023 manufacturing overhead budget to produce Product Peace. Variable overhead costs per direct labor hour are Indirect materials, P3; Indirect labor, P15; Maintenance, P2. Fixed costs totaled P68,000 composed of Supervisor's salaries, P36,000; Depreciation, P20,000; Maintenance, P12,000. Producing each unit requires 2 direct labor hours. Shalom Company estimates that units to be produced for each quarter are 3,000, 3,600, 4,000, and 6,000, respectively. Amounts must be in whole numbers. Example: 88,000 or (88,000) How much is the total manufacturing overhead budget? Cash payments in quarter 3
Wember Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $550 per month plus $77 per job plus $13 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in September to be 18 jobs and 148 meals, but the actual activity was 14 jobs and 145 meals. The actual cost for catering supplies in September was $3,340. The catering supplies in the planning budget for September would be closest to: Multiple Choice O $3,890 $3,860 $3,340 $3,513
Over and Under, Inc. manufactures weaving looms. Before the period began, the company prepared the following manufacturing overhead budget for an expected activity level of 15,000 direct labor hours (DL hrs): Variable Manufacturing Overhead Costs $322,500 Fixed Manufacturing Overhead Costs $205,000 By the end of the period, the company noted that 3,000 fewer direct labor hours were logged than expected. The total actual manufacturing overhead costs incurred during the period was $545,000, of which, $325,000 was fixed. Which of the following statements is incorrect for the above data? A. The total volume variance can be calculated by multiplying the unit variable cost by the difference between the expected DL hrs and the actual DL hrs. B. The master budget variance related to fixed manufacturing overhead costs for the period equals $120,000. C. The volume variance for variable manufacturing overhead costs is favorable because fewer DL hrs were logged during production than expected. D.…