MANAGERIAL ACCOUNTING F/MGRS.
5th Edition
ISBN: 9781259969485
Author: Noreen
Publisher: RENT MCG
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Chapter 10A, Problem 10A.3E
1
To determine
Predetermined
Introduction: Variance means the difference in value which comes when actual figure and estimated or budgeted figure are compared. It is helpful in finding out the cause of difference that arises between figures and formulates the corrective measure, which helps to reduce all those difficulties.
2
To determine
Amount of the overhead that would be applied to the output of the period.
Introduction: Variance means the difference in value which comes when actual figure and estimated or budgeted figure are compared. It is helpful in finding out the cause of difference that arises between figures and formulates the corrective measure, which helps to reduce all those difficulties.
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Applying Overhead in a Standard Costing System
Privack Corporation has a standard cost system in which it applies overhead to products base the standard direct labor-hours allowed for the actual output of the period. Data concerning most recent year appear below:
Required:
1. Compute the predetermined overhead rate for the year. Be sure to include the total budget fixed overhead and the total budgeted variable overhead in the numerator of your rate.
2. Compute the amount of overhead that would be applied to the output of the period.
Exercise 10A-3 (Algo) Applylng Overhead In a Standard CostIng System [LO10-4]
Privack Corporation has a standard cost system in which it applies overhead to products based on the standard direct labor-hours
allowed for the actual output of the period. Data concerning the most recent year appear below:
Budgeted variable overhead cost per direct labor-hour
Total budgeted fixed overhead cost per year
Budgeted direct labor-hours (denominator level of activity)
Actual direct labor-hours
Standard direct labor-hours allowed for the actual output
4.50
$ 563,213
59, 288
82, 000
81,600
Requlred:
1. Compute the predetermined overhead rate for the year. Be sure to include the total budgeted fxed overhead and the total budgeted
variable overhead in the numerator of yourrate. (Round your answer to the neorest whole dellar emnount.).
2. Compute the amount of overhead that would be applied to the outout of the period. (Round your Intermedlate calculetions and
final answer to the nearest whole doller…
Please do not give solution in image format thanku
Chapter 10A Solutions
MANAGERIAL ACCOUNTING F/MGRS.
Ch. 10A - Fixed Overhead Variances LO10—4 Primara...Ch. 10A - Prob. 10A.2ECh. 10A - Prob. 10A.3ECh. 10A - Prob. 10A.4ECh. 10A - Prob. 10A.5ECh. 10A - Prob. 10A.6ECh. 10A - Prob. 10A.7ECh. 10A - Applying Overhead; Overhead Variances LO10—3,...Ch. 10A - Prob. 10A.9PCh. 10A - Comprehensive Standard Cost Variances LO10—1,...
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- Cushing, 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. What was last years per unit product cost? a. 1.39 b. 4.40 c. 4.43 d. 3.01arrow_forwardUsing the data in P4-2 and Microsoft Excel: 1. Separate the variable and fixed elements. 2. Determine the cost to be charged to the product for the year. 3. Determine the cost to be charged to factory overhead for the year. 4. Determine the plotted data points using Chart Wizard. 5. Determine R2. 6. How do these solutions compare to the solutions in P4-2 and P4-3? 7. What does R2 tell you about this cost model?arrow_forwardExercise 10A-3 (Algo) Applying Overhead in a Standard Costing System [LO10-4] Privack Corporation has a standard cost system in which it applies overhead to products based on the standard direct labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below: Budgeted variable overhead cost per direct labor-hour Total budgeted fixed overhead cost per year Budgeted direct labor-hours (denominator level of activity) Actual direct labor-hours Standard direct labor-hours allowed for the actual output Required: 1. Compute the predetermined overhead rate for the year. Be sure to include the total budgeted fixed overhead and the total budgeted variable overhead in the numerator of your rate. (Round your answer to the nearest whole dollar amount.) 2. Compute the amount of overhead that would be applied to the output of the period. (Round your intermediate calculations and final answer to the nearest whole dollar amount.) 1. Predetermined overhead rate…arrow_forward
- Exercise 10A-3 (Algo) Applying Overhead in a Standard Costing System [LO10-4] Privack Corporation applies overhead to products based on the standard direct labor-hours allowed for the actual output. Data concerning the most recent year appear below: Budgeted variable overhead cost per direct labor-hour Total budgeted fixed overhead cost per year Budgeted direct labor-hours (denominator level of activity) Actual direct labor-hours Standard direct labor-hours allowed for the actual output Required: $ 4.00 $ 592,856 59,286 83,000 82,000 1. Compute the predetermined overhead rate for the year. Be sure to include the total budgeted fixed overhead and the total budgeted variable overhead in the numerator of your rate. Note: Round your answer to the nearest whole dollar amount. 2. Compute the amount of overhead applied to the output of the period. Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. 1. Predetermined overhead rate 2. Overhead applied…arrow_forwardExercise 10A-3 (Algo) Applying Overhead in a Standard Costing System [LO10-4] Privack Corporation applies overhead to products based on the standard direct labor-hours allowed for the actual output. Data concerning the most recent year appear below: Budgeted variable overhead cost per direct labor-hour Total budgeted fixed overhead cost per year Budgeted direct labor-hours (denominator level of activity) Actual direct labor-hours Standard direct labor-hours allowed for the actual output Required: 1. Predetermined overhead rate 2. Overhead applied $ 4.00 $ 528, 180 1. Compute the predetermined overhead rate for the year. Be sure to include the total budgeted fixed overhead and the total budgeted variable overhead in the numerator of your rate. Note: Round your answer to the nearest whole dollar amount. 2. Compute the amount of overhead applied to the output of the period. Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. per DLH 75,455…arrow_forwardPlease do not give solution in image format thankuarrow_forward
- E4-14 Venus Creations sells window treatments (shades, blinds, and awnings) to both commercial and residential customers. The following information relates to its budgeted operations for the current year. $300,000 Direct materials costs Direct labor costs 150,000 Setup time 500,000 Supervision $ 30,000 100,000 Commercial Operating income (loss) $480,000 Overhead costs Revenues $85,000 85,000 Estimated Overhead 90,000 60,000 $85,000 The controller, Peggy Kingman, is concerned about the residential product line. She cannot understand why this line is not more profitable given that the installations of window coverings are less complex for residential customers. In addition, the residential client base resides in close proximity to the company office, so travel costs are not as expensive on a per client visit for residential customers. As a result, she has decided to take a closer look at the overhead costs assigned to the two product lines to determine whether a more accurate product…arrow_forwardSolve requirment d, e, and farrow_forwardPlease Solve requriments a to farrow_forward
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