A company manufactures elliptical machines and treadmills. Activity cost pools and activity rates follow. Activity Assembly Quality control Activity Rate $ 15 per direct labor hour $10 per inspection Activity usage for treadmills follows. Compute the overhead cost per unit for treadmills. The company made 100 treadmills. Activity Usage Treadmills 390 90 Cost Driver Direct labor hours Inspections

A company manufactures elliptical machines and treadmills. Activity cost pools and activity rates follow. Activity Assembly Quality control Activity Rate $ 15 per direct labor hour $10 per inspection Activity usage for treadmills follows. Compute the overhead cost per unit for treadmills. The company made 100 treadmills. Activity Usage Treadmills 390 90 Cost Driver Direct labor hours Inspections

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 1EA: Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor...

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Rex Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Rex Industries data Activity Machine setups Machine hours Inspections Overhead per Activity $155,000 352,800 120,750 Annual Usage 4,000 14,112 3,500 Overhead Rate per Activity $ Complete the chart and compute the overhead rate for each activity. Round to the nearest penny, two decimal places.
Rex Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Compute the overhead rate for each activity. Round your answers to two decimal places. Overhead Overhead Annual Rate per Activity per Activity Usage Activity Machine Setups $157,850 4,100 $ Machine Hours 324,622 14,114 2$ Inspections 119,000 3,400
Rocks Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Activity Overhead per Activity Annual Usage Machine Set Up $75,000 6,000 Machine Hours $85,002 5,484 Inspections $70,000 20,000 Compute the overhead rate for each activity.
Sunland Company identifies three activities in its manufacturing process: machine setups, machining, and inspections. Estimated annual overhead cost for each activity is $165,900, $240,000, and $79,900, respectively. The cost driver for each activity and the estimated annual usage are number of setups 2,100, machine hours 24,000, and number of inspections 1,700. 1. Compute the overhead rate for each activity. Machine setups: $__ per setup Machining: $__ per machine hour Inspections: $__ per inspection
Rex Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Compute the overhead rate for each activity. Round your answers to two decimal places. Activity Overheadper Activity AnnualUsage OverheadRate perActivity Machine Setups $156,825 4,100 $fill in the blank 1 Machine Hours 352,750 14,110 $fill in the blank 2 Inspections 110,550 3,300 $fill in the blank 3
Alladdin Company EarPlug Production. Overhead is applied to products on the basis of direct labor hours. The denominator level of activity is 4,030 hours. The company’s standard cost card is below: Direct materials – Memory Foam: 6 pieces per EarPlug at $0.50 per piece Direct labor: 1.3 hours per EarPlug at $8 per hour Variable manufacturing overhead: 1.3 hours per EarPlug at $4 per hour Fixed manufacturing overhead: 1.3 hours per Earplug at $6 per hour During January, the company produced 3,000 CrittEars. The fixed overhead expense budget was $24,180. Actual costs in January were as follows: Direct materials: 25,000 pieces purchased at a cost of $0.48 per piece Direct labor: 4,000 hours were worked at a cost of $36,000 Variable manufacturing overhead: Actual cost was $17,000 Fixed manufacturing overhead: Actual cost was $25,000 Answer the below: Total Material Variance and the breakdown to the Material Price Variance, Material Quantity Variance. For the price and quantity…
Alladdin Company EarPlug Production. Overhead is applied to products on the basis of direct labor hours. The denominator level of activity is 4,030 hours. The company’s standard cost card is below: Direct materials – Memory Foam: 6 pieces per EarPlug at $0.50 per piece Direct labor: 1.3 hours per EarPlug at $8 per hour Variable manufacturing overhead: 1.3 hours per EarPlug at $4 per hour Fixed manufacturing overhead: 1.3 hours per Earplug at $6 per hour During January, the company produced 3,000 CrittEars. The fixed overhead expense budget was $24,180. Actual costs in January were as follows: Direct materials: 25,000 pieces purchased at a cost of $0.48 per piece Direct labor: 4,000 hours were worked at a cost of $36,000 Variable manufacturing overhead: Actual cost was $17,000 Fixed manufacturing overhead: Actual cost was $25,000 Answer the below: Total Material Variance Material Price Variance Material Quantity Variance. For the price and quantity variances discuss at least two…
Alladdin Company EarPlug Production. Overhead is applied to products on the basis of direct labor hours. The denominator level of activity is 4,030 hours. The company’s standard cost card is below: Direct materials – Memory Foam: 6 pieces per EarPlug at $0.50 per piece Direct labor: 1.3 hours per EarPlug at $8 per hour Variable manufacturing overhead: 1.3 hours per EarPlug at $4 per hour Fixed manufacturing overhead: 1.3 hours per Earplug at $6 per hour During January, the company produced 3,000 CrittEars. The fixed overhead expense budget was $24,180. Actual costs in January were as follows: Direct materials: 25,000 pieces purchased at a cost of $0.48 per piece Direct labor: 4,000 hours were worked at a cost of $36,000 Variable manufacturing overhead: Actual cost was $17,000 Fixed manufacturing overhead: Actual cost was $25,000 Answer the below: Overhead Budget Variance Overhead Volume Variance. Discuss at least two possible reasons for the variance
Alladdin Company EarPlug Production. Overhead is applied to products on the basis of direct labor hours. The denominator level of activity is 4,030 hours. The company’s standard cost card is below: Direct materials – Memory Foam: 6 pieces per EarPlug at $0.50 per piece Direct labor: 1.3 hours per EarPlug at $8 per hour Variable manufacturing overhead: 1.3 hours per EarPlug at $4 per hour Fixed manufacturing overhead: 1.3 hours per Earplug at $6 per hour During January, the company produced 3,000 CrittEars. The fixed overhead expense budget was $24,180. Actual costs in January were as follows: Direct materials: 25,000 pieces purchased at a cost of $0.48 per piece Direct labor: 4,000 hours were worked at a cost of $36,000 Variable manufacturing overhead: Actual cost was $17,000 Fixed manufacturing overhead: Actual cost was $25,000 Answer the below: Overhead Budget Variance, and Overhead Volume Variance. Discuss at least two possible reasons for the variance. Recommendation for…
Nas corporation's manager in the stamping department have been studying the overhead cost and the relationship machine hours. Data from the most recent 12 months Month Overhead Machine hours January February 5,030 2,730 1,600 600 March 7,210 3,403 April 4,560 2,200 May 6,880 3,411 June 6,520 2,586 July 6,230 3,364 August 5,570 2,411 September 7,728 3,960 October 5,810 2,897 November 4,580 2,207 December 6,010 2,864 The manager of the department has requested a regression analysis of these two variables. The staff person performing the analysis decided to exclude February. She observed the volume of activity was very low for that month because of two factors: A severe flue outbreak and an electrical fire that disrupted operations for about 10 working days.
Steeler Towel Company estimates its overhead to be $522,000. It expects to have 174,000 direct labor hours costing $5,220,000 in labor and utilizing 14,500 machine hours. Calculate the predetermined overhead rate using: Round your answers to two decimal places. A. Direct labor hours $ per direct labor hour B. Direct labor dollars $ per direct labor dollar C. Machine hours per machine hour
Sheffield Inc. manufactures two products: car wheels and truck wheels. To determine the amount of overhead to assign to each product line, the controller, Robert Hermann, has developed the following information. Car Truck Estimated wheels produced 45,000 9,000 Direct labor hours per wheel 1 3 Total estimated overhead costs for the two product lines are $835,200. Calculate overhead rate. (Round answer to 2 decimal places, e.g. 12.25.) Overhead rate $ per direct labor hour Compute the overhead cost assigned to the car wheels and truck wheels, assuming that direct labor hours is used to allocate overhead costs. Car wheels $ Truck wheels $ Hermann is not satisfied with the traditional method of allocating overhead because he believes that most of the overhead costs relate to the truck wheels product line…