A business plans for fixed production overheads of £100,000 and annual production of 200,000 units in its financial year. A fire at the factory results in production being only 150,000 units, with no saving in fixed production overheads. Based on the information above, what amount of unallocated overheads should be expensed in the Income Statement this year? Select one: O a. £75,000 O b. £0 Oc. None of the other answers shown d. £25,000 e. £12,500 Of. £100,000

A business plans for fixed production overheads of £100,000 and annual production of 200,000 units in its financial year. A fire at the factory results in production being only 150,000 units, with no saving in fixed production overheads. Based on the information above, what amount of unallocated overheads should be expensed in the Income Statement this year? Select one: O a. £75,000 O b. £0 Oc. None of the other answers shown d. £25,000 e. £12,500 Of. £100,000

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Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 3PA: Pocono Cement Forms expects $900,000 in overhead during the next year. It does not know whether it...

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A business plans for fixed production overheads of £200,000 and annual production of 400,000 units in its financial year. A fire at the factory results in production being only 300,000 units, with no saving in fixed production overheads. Based on the information above, what amount of unallocated overheads should be expensed in the Income Statement this year? Select one: a. £0 b. £12,500 c. £200,000 d.None of the other answers shown e. £50,000 f. £150,000
Company XYZ uses machine hours to allocate its manufacturing overhead. The company estimates that total machine hours to be operated next year are 190,000 hours. The estimated variable overhead is $10 per hour and the estimated fixed overhead costs are $152,000. Calculate the predetermined overhead rate. Select one O a. $10.80 b. None of the answers given c S0.00 O d. $11.80 e s0.09
Company XYZ uses direct labor hours to allocate its manufacturing overhead. The company estimates that total direct labor hours to be operated next year are 250,000 hours. The estimated variable overhead is OMR10 per hour and the estimated fixed overhead costs are OMR750,000. Calculate the predetermined overhead rate. Select one: a. OMR3.00 b. OMRO.08 C. None of the answers given d. OMR14.00 OMB13.00
Event Forms expects $120,000 in overhead during the next year. It doesn't know whether it should apply overhead on the basis of its anticipated direct labor hours of 6,000 or its expected machine hours of 5,000. What would be the product cost under each predetermined allocation rate if the last job incurred $3,500 in direct material cost, 55 direct labor hours, and 55 machine hours? Wages are paid at $17 per hour.
Pocono Cement Forms expects $900,000 in overhead during the next year. It does not know whether it should apply overhead on the basis of its anticipated direct labor hours of 60,000 or its expected machine hours of 30,000. Determine the product cost under each predetermined allocation rate if the last job incurred $1,550 in direct material cost, 90 direct labor hours, and 75 machine hours. Wages are paid at $16 per hour.
Your Company produces 5,000 units of Product X each year. Each unit of Product X sells for $8 and has a contribution margin of $5. Fixed costs are $30,000. If Product X is discontinued, $18,000 of fixed overhead would continue. As a result of discontinuing Product X, the company's overall operating income would: O A. increase by $13,000 O B. decreased by $13,000 OC. decrease by $7,000 O D. decreased by $25,000 O E. increase by $7,000
Among time basis and piece rate basis of wages payment which one will be beneficial for a less skilled worker, and why? 1. 2. ZS Co. has so far charged actual factory overhead to production. The system has not been proved satisfactory and, therefore, the company has decided to charge factory overhead on the basis of predetermined rate. Accordingly the following estimates have been made for the next year: Direct Labor 2,00,000 hours @ tk 10 Fixed Factory Overhead Tk 1,00,000 Variable Factory Overhead Tk 1,20,000 Semi Variable Overhead: Indirect Material (40% fixed) 80,000 Indirect Labor (65% variable) 92,000 Carriage outward (30% fixed) 1,16,000 Required: i. Factory overhead recovery rates on the basis of direct labor cost and direct labor hours. ii. The recovery rates if the direct labor hours were 1, 80,000 @ tk 12 3. Identify under or over allocation from the following information : i. Actual Overhead tk 2,000, allocated overhead tk 1,500 ii. Allocated Overhead 6,000 ,actual overhead…
The management of Bonga Corporation is considering dropping product D74F. Data from the company's accounting system for this product for last year appear below: Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses $932,000 $410,000 $346,000 $253,000 All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $212,000 of the fixed manufacturing expenses and $123,000 of the fixed selling and administrative expenses are avoidable if product D74F is discontinued. What would be the financial advantage (disadvantage) from dropping product D740
The management of Bonga Corporation is considering dropping product D74F. Data from the company's accounting system for this product for last year appear below: Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses $ 927,000 $ 407,500 $ 341,000 $ 248,000 All fixed expenses of the company are fully allocated to products in the company's accounting system. Further investigation has revealed that $209,500 of the fixed manufacturing expenses and $120,500 of the fixed selling and administrative expenses are avoidable if product D74F is discontinued. What would be the financial advantage (disadvantage) from dropping product D74F? Multiple Choice $189,500 ($69,500)
16 Hurawalhi Company uses machine-hours (MHs) to allocate their manufacturing overhead (MOH) cost with capacity-based method. The company recognized the cost of unused (idle) capacity of $600 on the income statement last year. Given the following information, how much was the company's estimated MHs for planned production last year? Estimated MOH cost (all fixed) $ Estimated MHs for planned production Estimated MHs at capacity ? MHs ? MHs $ 12 per MH $ 10 per MH POHR using the traditional method POHR at capacity А. 72 MHs В. 250 MHs С. 300 MHs D. 350 МHs E. 360 MHs
1 A company had the following costs in May when 400 units were produced: materials, $4,200; hourly labor, $1,600; depreciation, $800; rent, $700; and other fixed costs, $500. If the production level changes to 500 units, how much will the total costs be? Enter your answers as amounts only with neither commas nor decimals.
A week before the end of Its fiscal year, a company forecasts that It will not meet its target net operating income of $1,000,000 for the year (based on absorption costing). Forecast data is as follows: Sales Revenue Variable COGS Fixed manufacturing overhead Variable S&A: Commission on Sales Fixed S&A $200/unit $80/unit $10,000,000 $4,000,000 $5,000,000 3% $100,000 1:44 In the past, the company has had a policy of having zero inventories at the end of each period. For the current year, no further sales are possible and all of the units produced so far have been sold. The CEO has decided to produce additional units for Inventory in the last week of the year in order to meet the Income target. How many additional units (nearest whole number) need to be produced for inventory in the last week of the year in order to meet the net operating Income target if the sales commission is left unchanged at 3%? O 50,000 O 3,191 O 54,348 O 4,348