5th Edition

ISBN: 9780134128528

Author: Karen W. Braun, Wendy M. Tietz

Publisher: PEARSON

Concept explainers

Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.

Job Costing

Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing …

ABC Costing

Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In compari…

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Textbook Question

Chapter 4, Problem 4.2SE

Use departmental overhead rates to allocate manufacturing overhead (Learning Objective 1)

Whitney Furniture uses departmental overhead rates (rather than a plantwide overhead rate) to allocate its manufacturing overhead to jobs. The company’s two production departments have the following departmental overhead rates:

Cutting Department:	$9 per machine hour
Finishing Department:	$18 per direct labor hour

Job 484 used the following direct labor hours and machine hours in the two manufacturing departments:

JOB 484	Cutting Department	Finishing Department
Direct Labor Hours	2	7
Machine Hours	8	4

1. How much manufacturing overhead should be allocated to Job 484?
2. Assume that direct labor is paid at a rate of $24 per hour and Job 484 used $2,400 of direct materials. What was the total manufacturing cost of Job 484?

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Chapter 4, Problem 4.1SE

Chapter 4, Problem 4.3SE

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During its first year, Yutsang Enterprises showed a $22 per-unit profit under absorption costing but would have reported a total profit of $20,000 less under variable costing. Suppose production exceeded sales by 600 units and an average contribution margin of 58% was maintained. a. What is the fixed cost per unit? b. What is the sales price per unit? c. What is the variable cost per unit? d. What is the unit sales volume if total profit under absorption costing was $240,000?

Wood Manufacturing uses a job-order costing system and a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Manufacturing overhead cost and direct labor hours were estimated at $120,000 and 50,000 hours, respectively, for the year. In August, Job #527 was completed at a cost of $6,200 in direct materials and $3,000 in direct labor. The labor rate is $7 per hour. By the end of the year, Wood had worked a total of 55,000 direct labor-hours and had incurred $130,500 in actual manufacturing overhead cost. If Job #527 contained 250 units, the unit product cost on the completed job cost sheet would be___. Answer

Chapter 4 Solutions

Managerial Accounting (5th Edition)

Ch. 4 - Understanding key terms (Learning Objectives 1, 2,...Ch. 4 - Use departmental overhead rates to allocate...Ch. 4 - Compute departmental overhead rates (Learning...Ch. 4 - Prob. 4.4SE Ch. 4 - Prob. 4.5SE Ch. 4 - Calculate a job cost using ABC (Learning Objective...Ch. 4 - Classifying costs within the cost hierarchy...Ch. 4 - Classifying costs within the cost hierarchy...Ch. 4 - Determine the usefulness of refined costing...Ch. 4 - Prob. 4.10SE Ch. 4 - Identifying costs as value-added or...Ch. 4 - Identify lean production characteristics (Learning...Ch. 4 - Identify the DOWNTIME activities at a manufacturer...Ch. 4 - Prob. 4.14SE Ch. 4 - Classifying costs of quality (Learning Objective...Ch. 4 - Quality initiative decision (Learning Objective 5)...Ch. 4 - Assess the impact of a quality initiative...Ch. 4 - Identify ethical standards violated (Learning...Ch. 4 - Compare traditional and departmental cost...Ch. 4 - Compute activity rates and apply to jobs (Learning...Ch. 4 - Apply activity cost allocation rates (Learning...Ch. 4 - Using ABC to bill clients at a service firm...Ch. 4 - Compare traditional and ABC allocations at a...Ch. 4 - Compare traditional and ABC allocations on a job...Ch. 4 - Use ABC to allocate manufacturing overhead...Ch. 4 - Continuation of E4-25A: Determine product...Ch. 4 - Prob. 4.27AE Ch. 4 - Classify costs and make a quality-initiative...Ch. 4 - Prob. 4.29AE Ch. 4 - Compare traditional and departmental cost...Ch. 4 - Prob. 4.31BE Ch. 4 - Prob. 4.32BE Ch. 4 - Prob. 4.33BE Ch. 4 - Compare traditional and ABC cost allocations at a...Ch. 4 - Prob. 4.35BE Ch. 4 - Prob. 4.36BE Ch. 4 - Prob. 4.37BE Ch. 4 - Prob. 4.38BE Ch. 4 - Classify costs and make a quality-initiative...Ch. 4 - Prob. 4.40BE Ch. 4 - Prob. 4.41AP Ch. 4 - Use ABC to compute full product costs (Learning...Ch. 4 - Prob. 4.43AP Ch. 4 - Prob. 4.44AP Ch. 4 - Prob. 4.45AP Ch. 4 - Prob. 4.46BP Ch. 4 - Prob. 4.47BP Ch. 4 - Comprehensive ABC implementation (Learning...Ch. 4 - Using ABC in conjunction with quality decisions...Ch. 4 - Comprehensive ABC (Learning Objectives 2 3)...Ch. 4 - Prob. 4.51SC Ch. 4 - Discussion Questions 1. Explain why departmental...Ch. 4 - ABC in Real Companies Choose a company in any of...Ch. 4 - Value-Added versus Non-Value-Added at a Restaurant...Ch. 4 - Ethics involved with ABC and hazardous waste costs...

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Solution Summary: The author explains that manufacturing overhead to be allocated to Job 484 should be 198.

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