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 totalmonthly 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. Whatwas the variable cost per yard?OA. $1.00O B. $1.83O C. $0.55O D. $0.86

Variable Cost: Variable cost refers to the costs that change due to the changes occurring in the…

Answered: The manager at Screaming Trees has been…

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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During a recent accounting period, Falcon Express’ shipping department processed 22 orders. Each order typically takes four hours to complete. However, the average time increased to five hours because of various departmental inefficiencies. If shipping labor is paid $15 per hour, what would the company's non-value-added cost be?
Sweeten Company had no jobs in progress at the beginning of the year and no beginning inventories. It started, completed, and sold only two jobs during the year-Job P and Job Q. The company uses a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, it estimated that 4,000 machine-hours would be required for the period's estimated level of production. Sweeten also estimated $29,800 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $2.90 per machine-hour. Because Sweeten has two manufacturing departments-Molding and Fabrication-it is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following additional information to enable calculating departmental overhead rates: Estimated total machine-hours used Estimated total fixed manufacturing overhead Molding Fabrication 2,500 1,500 $ 16,800 $ 3.40 Estimated variable…
The manager of the Texas Department of Transportation has determined that it typically takes 30 minutes for the department's employees to register a new car. In Bexar County, the predetermined fixed overhead rate was computed on an estimated 16,000 direct labor hours per month and is $9 per direct labor hour, whereas the predetermined variable overhead rate is $3 per direct labor hour. During July, 30,080 cars were registered in Bexar County, and 15,200 direct labor hours were worked in registering those vehicles. For the month, variable overhead was $44,320 and fixed overhead was $145,280. a. Compute overhead variances using a four- variance approach. b. Compute overhead variances using a three- variance approach. c. Compute overhead variances using a two- variance approach.
Stuart Corporation expects to incur indirect overhead costs of $102,000 per month and direct manufacturing costs of $13 per unit. The expected production activity for the first four months of the year are as follows. Estimated production in units Required a. Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. b. Allocate overhead costs to each month using the overhead rate computed in Requirement a. c. Calculate the total cost per unit for each month using the overhead allocated in Requirement b. Required A Required B Complete this question by entering your answers in the tabs below. January February March 4,500 8,200 5,000 Required C Predetermined overhead rate $ Answer is complete but not entirely correct. Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. April 6,300 4 X per unit Required A Required B >
Munoz Corporation estimated its overhead costs would be $22,800 per month except for January when it pays the $179,010 annual insurance premium on the manufacturing facility. Accordingly, the January overhead costs were expected to be $201.810 ($179,010 + $22,800). The company expected to use 7.400 direct labor hours per month except during July, August, and September when the company expected 9,900 hours of direct labor each month to build inventories for high demand that normally occurs during the Christmas season. The company's actual direct labor hours were the same as the estimated hours. The company made 3,700 units of product in each month except July, August, and September, in which it produced 4,950 units each month. Direct labor costs were $24.80 per unit, and direct materials costs were $11.50 per unit. Required a. Calculate a predetermined overhead rate based on direct labor hours. b. Determine the total allocated overhead cost for January, March, and August. c. Determine…
Using the most appropriate overhead application based, the appliead factory overhead for the year is _________________
Sweeten Company had no jobs in progress at the beginning of the year and no beginning inventories. It started, completed, and sold only two jobs during the year-Job P and Job Q. The company uses a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, it estimated that 4,000 machine-hours would be required for the period's estimated level of production. Sweeten also estimated $29,800 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $2.90 per machine-hour. Because Sweeten has two manufacturing departments-Molding and Fabrication-it is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following additional information to enable calculating departmental overhead rates: Estimated total machine-hours used Estimated total fixed manufacturing overhead Molding Fabrication 2,500 1,500 $ 16,800 $ 3.40 Estimated variable…
Due to a strike in its supplier’s plant, Andretti Company is unable to purchase more material for the production of Daks. The strike is expected to last for two months. Andretti Company has enough material on hand to operate at 25% of normal levels for the two-month period. As an alternative, Andretti could close its plant down entirely for the two months. If the plant were closed, fixed manufacturing overhead costs would continue at 40% of their normal level during the two-month period and the fixed selling expenses would be reduced by 20% during the two-month period. (Round number of units produced to the nearest whole number. Round your intermediate calculations and final answers to 2 decimal places. Any losses or reductions should be indicated by a minus sign.)a. How much total contribution margin will Andretti forgo if it closes the plant for two months?b. How much total fixed cost will the company avoid if it closes the plant for two months?c. What is the financial advantage…
Tech Solutions computes its predetermined overhead rate annually based on direct labor - hours. At the beginning of the year, it estimated 50,000 direct labor - hours would be required for the period's estimated level of client service. The company also estimated $ 225,000 of fixed overhead cost for the coming period and variable overhead of $0.50 per direct labor - hour. The firm's actual overhead cost for the year was $238, 100 and its actual total direct labor was 53, 100 hours. Required: 1. Compute the predetermined overhead rate. 2. During the year, Tech Solutions started and completed the Xavier Company engagement. The following information was available for this job: Direct materials $ 44, 850 Direct labor cost $ 28, 200 Direct labor - hours worked 200 Compute the total job cost for Xavier Company.
Walton Corporation estimated its overhead costs would be $23,400 per month except for January when it pays the $135,870 annual insurance premium on the manufacturing facility. Accordingly, the January overhead costs were expected to be $159,270 ($135,870 + $23,400). The company expected to use 7,500 direct labor hours per month except during July, August, and September when the company expected 9,800 hours of direct labor each month to build inventories for high demand that normally occurs during the Christmas season. The company's actual direct labor hours were the same as the estimated hours. The company made 3,750 units of product in each month except July, August, and September, in which it produced 4,900 units each month. Direct labor costs were $24.90 per unit, and direct materials costs were $11.10 per unit. Required a. Calculate a predetermined overhead rate based on direct labor hours. b. Determine the total allocated overhead cost for January, March, and August. c. Determine…
Stargazer Company logged 7,250 machine hours for the month of June. P42,500 was spent for manufacturing overhead and this overhead is allocated on the basis of machine hours. The company operates 5 departments; however, one department was closed for the month of June due to poor market conditions for its product. It was decided that this department (#3) should be allocated a lump sum of P5,000 as its share of June overhead. 24. If this policy is followed, how much overhead would be charged to Department 2, which used 1,750 machine hours? P 1,207 b. P 9,052. m а. na C. P10,259 etr od bluovEdoo d. P20,714
Cavy Company estimates that the factory overhead for the following year will be $2,034,500. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 31,300 hours. The machine hours for the month of April for all of the jobs were 2,830. If the actual factory overhead for April totaled $180,455, determine the over- or underapplied amount for the month. Enter the amount as a positive number.

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