The following information pertains to Nova Division, which uses a plant wide overhead rate based on machine hours: Department Mixing Dept. Finishing Dept. Total Overhead Cost $70,000 $130,000 $200,000 Direct Labor Hours 8,000 3,000 11,000 Machine Hours 3,000 7,000 10,000 Department Production information for Job 205: Mixing Dept. Finishing Dept. Total Prime Costs $12,000 $0 $12,000 Direct Labor Hours 300 0 300 Machine Hours 15 12 27 Units Produced 600 0 600 What are the total overhead costs assigned to Job 205?

The following information pertains to Nova Division, which uses a plant wide overhead rate based on machine hours: Department Mixing Dept. Finishing Dept. Total Overhead Cost $70,000 $130,000 $200,000 Direct Labor Hours 8,000 3,000 11,000 Machine Hours 3,000 7,000 10,000 Department Production information for Job 205: Mixing Dept. Finishing Dept. Total Prime Costs $12,000 $0 $12,000 Direct Labor Hours 300 0 300 Machine Hours 15 12 27 Units Produced 600 0 600 What are the total overhead costs assigned to Job 205?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter7: Allocating Costs Of Support Departments And Joint Products

Section: Chapter Questions

Problem 28E: Minor Co. has a job order cost system and applies overhead based on departmental rates. Service...

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Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
Lansing. Inc., provided the following data for its two producing departments: Machine hours are used to assign the overhead of the Molding Department, and direct labor hours are used to assign the overhead of the Polishing Department. There are 30,000 units of Form A produced and sold and 50,000 of Form B. Required: 1. Calculate the overhead rates for each department. 2. Using departmental rates, assign overhead to live two products and calculate the overhead cost per unit. How does this compare with the plantwide rate unit cost, using direct labor hours? 3. What if the machine hours in Molding were 1,200 for Form A and 3,800 for Form B and the direct labor hours used in Polishing were 5,000 and 15,000, respectively? Calculate the overhead cost per unit for each product using departmental rates, and compare with the plantwide rate unit costs calculated in Requirement 2. What can you conclude from this outcome?
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