Glencoe, Inc., costs products using a normal costing system. The following data is available for last year: Budgeted: 4.1 4.2 4.3 Overhead Machine hours Direct labour hours 4.4 Actual: Overhead Machine hours Direct labour hours Prime cost Number of units R476 000 140 000 17 000 Overhead is applied on the basis of direct labour hours. Required: R475 000 137 000 16 550 R1 750 000 250 000 Calculate the predetermined overhead rate. Calculate the applied overhead for last year. Was the overhead over- or under-applied, and by how much? Calculate the total cost per unit produced (to 2 decimal places).
Glencoe, Inc., costs products using a normal costing system. The following data is available for last year: Budgeted: 4.1 4.2 4.3 Overhead Machine hours Direct labour hours 4.4 Actual: Overhead Machine hours Direct labour hours Prime cost Number of units R476 000 140 000 17 000 Overhead is applied on the basis of direct labour hours. Required: R475 000 137 000 16 550 R1 750 000 250 000 Calculate the predetermined overhead rate. Calculate the applied overhead for last year. Was the overhead over- or under-applied, and by how much? Calculate the total cost per unit produced (to 2 decimal places).
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 11E: Ripley, Inc., costs products using a normal costing system. The following data are available for...
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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