The Oswell Company manufactures products in two departments: Mixing and Packaging. The company allocates manufacturing overhead using a single plantwide rate with direct labor hours as the allocation base. Estimated overhead costs for the year are $579,800, and estimated direct labor hours are 260,000. In October, the company incurred 60,000 direct labor hours. Requirement 1. Compute the predetermined overhead allocation rate. Round to two decimal places. Begin by selecting the formula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate. Predetermined OH ? ÷ ? = allocation rate ? ÷ ? = ? Requirement 2. Determine the amount of overhead allocated in October. Begin by selecting the formula to allocate overhead costs. Allocated mfg. ? × ? = overhead costs The overhead allocated in October is ? .
The Oswell Company manufactures products in two departments: Mixing and Packaging. The company allocates manufacturing overhead using a single plantwide rate with direct labor hours as the allocation base. Estimated overhead costs for the year are $579,800, and estimated direct labor hours are 260,000. In October, the company incurred 60,000 direct labor hours. Requirement 1. Compute the predetermined overhead allocation rate. Round to two decimal places. Begin by selecting the formula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate. Predetermined OH ? ÷ ? = allocation rate ? ÷ ? = ? Requirement 2. Determine the amount of overhead allocated in October. Begin by selecting the formula to allocate overhead costs. Allocated mfg. ? × ? = overhead costs The overhead allocated in October is ? .
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Question
The Oswell Company manufactures products in two departments: Mixing and Packaging. The company allocates manufacturing overhead using a single plantwide rate with direct labor hours as the allocation base. Estimated overhead costs for the year are $579,800, and estimated direct labor hours are 260,000. In October, the company incurred 60,000 direct labor hours.
Requirement 1. Compute the predetermined overhead allocation rate. Round to two decimal places.
Begin by selecting the formula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate.
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Predetermined OH
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?
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÷
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?
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=
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allocation rate
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÷
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?
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=
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?
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Requirement 2. Determine the amount of overhead allocated in
October.
Begin by selecting the formula to allocate overhead costs.
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Allocated mfg.
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×
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?
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=
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overhead costs
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The overhead allocated in October is
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