The manager at Wheeling Mulch has been trying to calculate the portion of the company's overhead expenses that are 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 $31,000 for 34,000 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 $21,000 for 26,000 yards of mulch processed. What was the variable cost per yard?

The manager at Wheeling Mulch has been trying to calculate the portion of the company's overhead expenses that are 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 $31,000 for 34,000 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 $21,000 for 26,000 yards of mulch processed. What was the variable cost per yard?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 23Q: If a factory operates at 100% of capacity one month, 90% of capacity the next month, and 105% of...

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The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning February 1 would be 3,150,000, and total direct labor costs would be 1,800,000. During February, the actual direct labor cost totalled 160,000, and factory overhead cost incurred totaled 283,900. a. What is the predetermined factory overhead rate based on direct labor cost? b. Journalize the entry to apply factory overhead to production for February. c. What is the February 28 balance of the account Factory OverheadBlending Department? d. Does the balance in part (c) represent over- or underapplied factory overhead?
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