The Saluki Company specializes in making fraternity and sorority T-shirts for the college market. Due to the high setup costs for each batch printed, Saluki holds the T-shirt requests until demand is approximately 100 shirts. At that point Saluki will schedule the setup and production of the shirts. For rush orders, Saluki will produce smaller batches for an additional charge of $175 per setup. Budgeted and actual costs for the production process for 2017 were as follows: Static-Budget Amounts Number of shirts produced Average number of shirts per setup Hours to set up machines Direct variable cost per setup-hour Total fixed setup overhead costs Actual Results 114,000 95 5.20 2$ $56,000 125,000 $ 30 32 $56,250

Q: Over absorption overhead occurs when ?

A: Introduction: Overhead absorption is the number of indirect expenses attributed to cost components.…

Q: Over absorption overhead occurs when ?

A: Over absorption :- Over Absorption means the actual Expenditure incurred lower then expected. For…

Q: There must be a correlation between the activity and changes in the amount of overhead.   True /…

A: Correlation:-It refers to the statistical relationship between two variables or activities.…

Q: how do I find total over- or underapplied fixed manufacturing overhead?

A: Overhead: Overhead refers to the costs, which are utilized in business activities, however cannot be…

Q: What is meant by overheads? How are overheads classified? Give suitable examples

A: Overhead refers to the expenses a business incurs on a daily basis while operating its activities.

Q: Define the terms under-allocated and over-allocated overhead. What factors contribute to each…

A: Expenses associated with manufacturing overhead: "Manufacturing overhead costs, also known as…

Q: Formula for FIxed Overhead How do you find fixed overhead?  What is the formula?

A: Overheads refers to the total cost of indirect materials, indirect labour and indirect expenses.…

Q: How is predetermined overhead rate established? How is it used to apply overhead?

A:

Q: Which accounts are adjusted for the under-allocated or over-allocated overhead in JIT costing?

A: Just-in-time manufacturing system:     Just-in-time (JIT) manufacturing system is an approach to…

Q: Explain the benefits of using a predetermined overhead rate instead of an actual overhead rate.

A:

Q: a predetermined application rate for conversion costs is based on actual conversion costs divided by…

A: Conversion costs are costs that are incurred for converting raw materials of the business into…

Q: How do you get total of period cost?

A: Period Costs are not directly associated with the finished products manufactured, rather associated…

Q: Define period costs.

A: Period costs are not joined to items and the company does not need for Offer on Sale of items and…

Q: Which types of overhead allocation methods result in the use of more than one overhead rate during…

A: The objective of the question is to identify the overhead allocation methods that result in the use…

Q: What is the standard variable overhead rate and standard fixed overhead rate?

A: The overhead rate is calculated by dividing total indirect costs (also known as overhead) for a…

Q: What are the justifications for using practical capacity as the denominator volume when…

A: Fixed cost volume variance: The fixed cost volume variance is the difference between the budgeted…

Q: Explain the difference between under-allocated overhead and over-allocated overhead. What causes…

A: Overhead is applied using estimated or budgeted overhead and a base. Actual overhead costs are…

Q: What does it means when the Overhead rates in the direct method have a figure which is higher than…

A: Overheads: It refers to the business indirect expenses that are required to run a business activity.…

Q: What adjustment is made for underapplied overhead on the schedule of CoGS? What adjustment is made…

A: Underapplied overhead is added to cost of goods sold thus increases the total cost of goods sold.

Q: How do you calculate the predetermined overhead rate do you have an example

A: An allocation rate used to estimate the manufacturing costs is termed as predetermined overhead…

Q: An overhead absorption rate based on direct labour cost is known as the: A. Direct labour hour rate…

A: Overhead absorption meaning:- The quantity of indirect costs ascribed to cost items is refereed to…

Q: Define fixed overhead variance.

A: Fixed Overhead Variance is the difference between actual and absorbed fixed production overheads…

Q: standard cost

A: Standard cost systems are cost accounting systems in which standard is set for each item of cost and…

Q: When used as the denominator in the calculation of an overhead rate, which of the following will…

A: Capacity or activity level helps to determine the maximum or ideal level at which production can be…

Q: What is meant by underapplied overhead? By overappliedoverhead?

A: Actual overhead cost: These are the indirect manufacturing costs that are actually incurred while…

Q: n fixed overhead applied to work in process 3600

A: Standard fixed overhead applied is the standard direct hours available into standard fixed overhead…

Q: what are the two main factors that give to over/under absorption of overhead ?

A: When overheads are absorbed in a rate depending on actual data, the absorbed overhead should be…

Q: Describe how a single plantwide overhead allocation rate is used.

A: Cost: It refers to the economic value incurred by a company to produce a product or a service.

Q: How is the predetermined overhead allocation rate used by service companies?

A: Definition:   Manufacturing Overheads:   Predetermined manufacturing overhead rate is the rate that…

Q: Applied overhead consists of which of the following?     a. actual activity times predetermined…

A: Predetermined overhead rate = Estimated overhead / estimated activity

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance. 

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.