General accounting Titan Sports Inc. manufactures athletic gear. The managers are planning for next year and want tounderstand the relationship between activity and overhead costs. Discussions with the plant supervisorsuggest that overhead costs vary with labor hours, machine hours, or both. The following data were collectedfrom last year's operations.Month Labor Hours Machine Hours Overhead Costs ($)8201,420105,68027901,512111,74037651,645118,85048501,590116,23059001,725126,50068751,708124,32078601,500112,5600088151,380106,41098101,560113,970109201,680122,050117701,350102,380127851,750120,210

Step 1: Define High-Low MethodThe high-low method is a cost estimation technique used to separate…

Answered: Titan Sports Inc. manufactures athletic…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter3: Cost Behavior

Section: Chapter Questions

Problem 10E: SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that...

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Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500 machine hours. The cost to make Job 416 is $95 in neon, 15 hours of labor at $13 per hour, and five machine hours. During the month, it incurs $95 in indirect material cost, $130 in administrative labor, $320 in utilities, and $350 in depreciation expense. What is the predetermined overhead rate if machine hours are considered the cost driver? What is the cost of Job 416? What is the overhead incurred during the month?
CleanCom Company specializes in cleaning commercial buildings and construction sites. Each building and site is different, requiring amounts and types of supplies and labor for each job. CleanCom estimated the following for the year: During the year, the following actual amounts were experienced: If CleanCom uses a normal costing system and overhead is applied on the basis of direct labor hours, what is the cost of cleaning a construction site that takes 140 of direct materials and 21 direct labor hours? a. 455 b. 508 c. 648 d. 644
Please use the information from this problem for these calculations. After grouping cost pools and estimating overhead and activities, Box Springs determined these rates: Box Springs estimates there will be four orders in the next year, and those jobs will involve: What is the total cost of the jobs?
Please use the information from this problem for these calculations. After grouping cost pools and estimating overhead and activities, Box Springs determined these rates: It estimates there will be five orders in the next year, and those jobs will involve: What is the total cost of the jobs?
Ripley, Inc., costs products using a normal costing system. The following data are available for last year: Overhead is applied on the basis of direct labor hours. Required: 1. What was the predetermined overhead rate? 2. What was the applied overhead for last year? 3. Was overhead over- or underapplied, and by how much? 4. What was the total cost per unit produced (carry your answer to four significant digits)?
Nutts management is very concerned about the cost of overhead on its jobs. When jobs are complete, overhead costs should be between 15% and 20% of total costs. For example, the labor cost on Job 8958 is 25% of total costs, higher than the norm. Open Job 8961 and click the Chart sheet tab. A pie chart appears showing the cost components on that job. Record the labor cost percentage in the space provided. Repeat this for each of the jobs worked on in August. Did Nutt maintain good cost control on all its jobs? Explain. Worksheet. During September, Job 8963 required two additional material requisitions to complete the job. Open JOB8963 and modify the job cost sheet to include an area for four direct material requisition entries instead of three. Then enter the following two materials requisitions onto the worksheet: Preview the printout to make sure it will print neatly on one page, and then print the worksheet. Save the completed worksheet as JOBT. Chart. Open JOB8964 and click the Chart sheet tab. Prepare a bar chart for JOB8964 showing the amount of material, labor, and overhead required to complete the job. Use the Chart Data Table found in rows 4246 as a basis for preparing the chart. Enter your name somewhere on the chart. Save the file again as J0B8964. Print the chart.
Natur-Gro, Inc., manufactures composters. Based on past experience, Natur-Gro has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 264,000 + 1.42X, where X equals number of composters. Last year, Natur-Gro produced 30,000 composters. Actual overhead costs for the year were as expected. Total overhead for per unit was a. 1.42 b. 8.80 c. 11.63 d. 10.22
Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)
Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations. Month Labor-Hours Machine-Hours Overhead Costs 1 725 1,349 $ 102,630 2 720 1,404 103,742 3 685 1,517 109,818 4 750 1,459 108,368 5 770 1,589 116,290 6 745 1,583 114,521 7 735 1,396 107,079 8 720 1,307 102,082 9 715 1,463 106,471 10 790 1,538 113,065 11 675 1,298 103,776 12 720 1,608 116,796 Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average…
Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor hours, machine hours, or both. The following data were collected from last year’s operations. Month Labor-Hours Machine-Hours Overhead costs 1 720 1,355 $ 102,644 2 720 1,411 103,842 3 675 1,527 109,938 4 750 1,462 108,297 5 785 1,582…
The management of Casablanca Manufacturing Corporation believes that machine-hours is an appropriate measure of activity for overhead cost. Shown below are machine-hours and total overhead costs for the past six months: January February March April May June Machine- Hours 150,000 140,000 160,000 130,000 170,000 200,000 $319,500 $362,500 $400,000 Assume that the relevant range includes all of the activity levels mentioned in this problem. What is Casablanca's independent variable? Multiple Choice Overhead Cost $339,000 $328,000 $350, eeb the year the total overhead cost
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