Mazoon Leather Company decided to use a multiple predetermined overhead rate to apply manufacturing overhead to jobs. The predetermined overhead rate chosen is labor hours for Primary Treatment Department and machine- hours for Secondary Treatment Department. The accounting records shows the following estimates made at the beginning of the year: Primary Secondary Treatment Treatment Manufacturing overhead cost $120,000 $ 60,000 Machine-hours 4,000 30,000 Direct labor-hours 12,000 6,000 Direct labor cost $ 20,000 $ 40,000 What predetermined overhead rates would be used in Mazoon Leather for Primary Treatment Department and Secondary Treatment Department, respectively? a. $10 and $2 Ob. $6 and 150% O C. $10 and 150% O d. None of the given answers

Mazoon Leather Company decided to use a multiple predetermined overhead rate to apply manufacturing overhead to jobs. The predetermined overhead rate chosen is labor hours for Primary Treatment Department and machine- hours for Secondary Treatment Department. The accounting records shows the following estimates made at the beginning of the year: Primary Secondary Treatment Treatment Manufacturing overhead cost $120,000 $ 60,000 Machine-hours 4,000 30,000 Direct labor-hours 12,000 6,000 Direct labor cost $ 20,000 $ 40,000 What predetermined overhead rates would be used in Mazoon Leather for Primary Treatment Department and Secondary Treatment Department, respectively? a. $10 and $2 Ob. $6 and 150% O C. $10 and 150% O d. None of the given answers

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Description: Mazoon Leather Company decided to use a multiplepredetermined overhead rate to apply manufacturingoverhead to jobs. The predetermined overhead rate chosen islabor hours for Primary Treatment Department and machine-hours for Secondary Treatment Depar

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 11PB: When setting its predetermined overhead application rate. Tasty Turtle estimated its overhead would...

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A company calculated the predetermined overhead based on an estimated overhead of $70.000, and the activity for the cost driver was estimated as 2,500 hours. If product A utilized 1,350 hours and product 8 utilized 1,100 hours, what was the total amount of overhead assigned to the products? A. $35000 B. $30.800 C. $37,800 D. $68,600
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?
Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500 machine hours. The cost to make Job 416 is $95 in neon, 15 hours of labor at $13 per hour, and five machine hours. During the month, it incurs $95 in indirect material cost, $130 in administrative labor, $320 in utilities, and $350 in depreciation expense. What is the predetermined overhead rate if machine hours are considered the cost driver? What is the cost of Job 416? What is the overhead incurred during the month?
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?
Primera Company produces two products and uses a predetermined overhead rate to apply overhead. Primera currently applies overhead using a plantwide rate based on direct labor hours. Consideration is being given to the use of departmental overhead rates where overhead would be applied on the basis of direct labor hours in Department 1 and on the basis of machine hours in Department 2. At the beginning of the year, the following estimates are provided: Actual results reported by department and product during the year are as follows: Required: 1. Compute the plantwide predetermined overhead rate and calculate the overhead assigned to each product. 2. Calculate the predetermined departmental overhead rates and calculate the overhead assigned to each product. 3. Using departmental rates, compute the applied overhead for the year. What is the under- or overapplied overhead for the firm? 4. Prepare the journal entry that disposes of the overhead variance calculated in Requirement 3, assuming it is not material in amount. What additional information would you need if the variance is material to make the appropriate journal entry?
Coops Stoops estimated its annual overhead to be $85,000 and based its predetermined overhead rate on 24,286 direct labor hours. At the end of the year, actual overhead was $90,000 and the total direct labor hours were 24,100. What is the entry to dispose of the over applied or under applied overhead?
Compute the total job cost for each of the following scenarios: a. If the direct labor cost method is used in applying factory overhead and the predetermined rate is 100%, what amount should be charged to Job 2010 for factory overhead? Assume that direct materials used totaled 5,000 and that the direct labor cost totaled 3,200. b. If the direct labor hour method is used in applying factory overhead and the predetermined rate is 10 an hour, what amount should be charged to Job 2010 for factory overhead? Assume that the direct materials used totaled 5,000, the direct labor cost totaled 3,200, and the number of direct labor hours totaled 250. c. If the machine hour method is used in applying factory overhead and the predetermined rate is 12.50 an hour, what amount should be charged to Job 2010 for factory overhead? Assume that the direct materials used totaled 5,000, the direct labor cost totaled 3,200, the direct labor hours were 250 hours, and the machine hours were 295 hours.
York Company Is a machine shop that estimated overhead will be $50,000, consisting of 5,000 hours of direct labor. The cost to make job 0325 is $70 in aluminum and two hours of labor at $20 per hour. During the month. York incurs $50 in indirect material cost. $150 in administrative labor, $300 in utilities, and $250 in depreciation expense. What is the predetermined overhead rate if direct labor hours are considered the cost driver? What is the cost of Job 0325? What is the overhead incurred during the month?
Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
Nutt Products manufactures screws and bolts made to customer specifications. During August, Nutt incurred the following manufacturing costs: direct materials, 28,019.00; direct labor, 15,276.75; and applied factory overhead, 9,854.50. The following data pertain to these costs: The overhead application rates are 4 per direct labor hour for Dept. 1 and 175% of direct labor cost for Dept. 2. Nutt had no beginning work in process for August. Job 8958, which cost 14,190.18 to manufacture, was completed in July and was sold on account in August for 19,000. The job cost sheet for this job is shown on page 103. Of the jobs begun in August, Job 8961 was completed and sold on account for 24,000, Jobs 8962 and 8964 were completed but not sold, and Job 8963 was still in process. As cost accountant for this company, you have been asked to prepare job cost sheets for each of the four jobs started in August. Review the printed worksheet called JOB that follows these requirements.
When setting its predetermined overhead application rate. Tasty Turtle estimated its overhead would be $75,000 and manufacturing would require 25,000 machine hours in the next year. At the end of the year, it found that actual overhead was $74,000 and manufacturing required 24,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under- or over applied overhead.
Chester Company provided information on overhead for its three producing departments as follows: Overhead is applied on the basis of machine hours in Fabricating and direct labor hours in Assembly and in Finishing. Job #13-198 had total prime cost of 6,700. The job took 40 machine hours in Fabricating, 100 direct labor hours in Assembly, and 20 direct labor hours in Finishing. What is the total cost of Job# 13-198? a. 6,700.00 b. 1,523.20 c. 8,223.20 d. 7,383.20