Little Company uses a standard costing system. The following monthly cost functions apply to its manufacturing overhead items: Overhead Item Cost Function Indirect materials P0.80 per DLH P1.00 per DLH PO.40 per DLH P8,000 Р32,000 Indirect labor Utilities Insurance Depreciation Information for the month of October is as follows: Actual overhead costs incurred: Indirect materials P20,800 24,000 9,600 8,800 32,000 P95,200 Indirect labor Utilities Insurance Depreciation Total Actual direct labor hours worked 24,000 27,000 Standard direct labor hours allowed for production achieved Little uses expected capacity to calculate standard overhead rates. The monthly expected capacity is 25,000 hours. Required: а. Calculate the following standard overhead rates based upon expected capacity:

Little Company uses a standard costing system. The following monthly cost functions apply to its manufacturing overhead items: Overhead Item Cost Function Indirect materials P0.80 per DLH P1.00 per DLH PO.40 per DLH P8,000 Р32,000 Indirect labor Utilities Insurance Depreciation Information for the month of October is as follows: Actual overhead costs incurred: Indirect materials P20,800 24,000 9,600 8,800 32,000 P95,200 Indirect labor Utilities Insurance Depreciation Total Actual direct labor hours worked 24,000 27,000 Standard direct labor hours allowed for production achieved Little uses expected capacity to calculate standard overhead rates. The monthly expected capacity is 25,000 hours. Required: а. Calculate the following standard overhead rates based upon expected capacity:

Name: b. Calculate the following variances:1. Variable overhead spending va
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Description: b. Calculate the following variances:1. Variable overhead spending variance2. Variable overhead efficiency variance3. Fixed overhead spending variance4. Fixed overhead volume variance Little Company uses a standard costing system. The following mont

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 12P: Overhead application rate Roll Tide Manufacturing Inc. uses a job order cost system and standard...

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The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning February 1 would be 3,150,000, and total direct labor costs would be 1,800,000. During February, the actual direct labor cost totalled 160,000, and factory overhead cost incurred totaled 283,900. a. What is the predetermined factory overhead rate based on direct labor cost? b. Journalize the entry to apply factory overhead to production for February. c. What is the February 28 balance of the account Factory OverheadBlending Department? d. Does the balance in part (c) represent over- or underapplied factory overhead?
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. 3.01
Aero Aluminum Inc. uses a process cost system. The records for May show the following information: Using the data in P5-9, draft the journal entries to record: 1. The cost of goods received from Rolling during the month. 2. The production costs incurred in Converting during the month. 3. The cost of goods completed and transferred to finished goods during the month.
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)?
Queen Bees Honey, Inc., estimated its annual overhead to be $110,000 and based its predetermined overhead rate on 27,500 direct labor hours. At the end of the year, actual overhead was $106,000 and the total direct labor hours were 29,000. What is the entry to dispose of the over applied or under applied overhead?
Daytona Beverages Inc. uses the FIFO cost method and adds all materials, labor, and factory overhead evenly to production. A record of the factory operations for October follows: Required: Prepare a cost of production summary for the month.
On October 31, the end of the first month of operations, Maryville Equipment Company prepared the following income statement, based on the variable costing concept: Prepare an income statement under absorption costing.
Overhead application rate Creole Manufacturing Inc. uses a job order cost system and standard costs. It manufactures one product, whose standard cost follows: The standards are based on normal capacity of 2,400 direct labor hours. Actual activity for October follows: Required: 1. Compute the variable and fixed factory overhead rates per unit. 2. Compute the variable and fixed overhead rates per direct labor hour. 3. Determine the total fixed factory overhead based on normal capacity.
Premier Products Inc. has three departments and uses the process cost system of accounting. A portion of the departmental cost work sheet prepared by the cost accountant at the end of July is reproduced below. Using the data in P5-7: 1. Draft the necessary entries to charge the materials and labor costs to the appropriate work in process accounts, to apply factory overhead to work in process, and to record the transfer of costs from one department to another. 2. Prepare a statement of cost of goods manufactured for the month ended July 31.
During the year, a company purchased raw materials of $77,321, and incurred direct labor costs of $125,900. Overhead is applied at the rate of 75% of the direct labor cost. These are the inventory balances: Compute the cost of materials used in production, the cost of goods manufactured, and the cost of goods sold.
During March, the following costs were charged to the manufacturing department: $14886 for materials; $14,656 for labor; and $13,820 for manufacturing overhead. The records show that 30,680 units were completed and transferred, while 2,400 remained in ending inventory. There were 33,080 equivalent units of material and 31,640 of conversion costs. Using the weighted-average method, what is the cost of inventory transferred and the balance in work in process inventory?
Units of production data for the two departments of Atlantic Cable and Wire Company for July of the current fiscal year are as follows: Each department uses the weighted average method. For each department, assume that direct Materials are placed in process during production. a. Determine the number of whole units to be accounted for and to be assigned costs and the equivalent units of production for the Drawing Department. b. Determine the number of whole units to be accounted for and to be assigned costs and the equivalent units of production for the Winding Department.