Managerial Accounting: Tools for Business Decision Making
7th Edition
ISBN: 9781118334331
Author: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Publisher: WILEY
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 10, Problem 10.6BE
In the Assembly Department of Hannon Company, budgeted and actual manufacturing
| Budget | Actual | |
| Indirect materials | $16,000 | $14,300 |
| Indirect labor | 20,000 | 20,600 |
| Utilities | 10,000 | 10,850 |
| Supervision | 5,000 | 5,000 |
All costs are controllable by the department manager. Prepare a responsibility report for April for the cost center.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Heitger Company is a job-order costing firm that uses activity-based costing to apply overhead to jobs. Heitger identified three overhead activities and related drivers. Budgeted information for the year is as follows:
Activity
Cost
Driver
Amount of Driver
Materials handling
$91,350
Number of moves
3,500
Engineering
120,900
Number of change orders
6,500
Other overhead
392,700
Direct labor hours
51,000
Heitger worked on four jobs in July. Data are as follows:
Job 13-43
Job 13-44
Job 13-45
Job 13-46
Beginning balance
$23,000
$18,700
$4,700
$0
Direct materials
$5,300
$9,350
$13,100
$9,900
Direct labor cost
$970
$1,050
$1,520
$100
Job 13-43
Job 13-44
Job 13-45
Job 13-46
Number of moves
41
53
28
6
Number of change orders
30
44
24
15
Direct labor hours
970
1,050
1,520
100
By July 31, Jobs 13-43 and 13-44 were completed and sold. Jobs 13-45 and 13-46 were still in process.
Required
4.…
Company A uses the weighted average method in its processing costing system.
Manufacturing overhead (MOH) costs are applied to production on the basis of machine
hours logged during the period. Total budgeted MOH for the period was $400,000 and total
budgeted machine hours were 100,000. The following data concern the operations of the
company's first processing department for June 2011.
Beginning work-in-process
Costs in beginning work-in-
process
Units started during June
Costs added during June
Manufacturing overhead
Ending work-in-process
800 mops, 60% complete with respect to direct
materials, 10% complete with respect to
conversion
$1,296 in materials and $2,416 in conversion
costs
16,000 mops
direct materials of $47,076 and direct labor of
$216,213
actual machine hours logged during June were
70,250, actual MOH costs incurred during June
were $280,000
300 mops, 100% completed with respect to direct
materials, 70% complete with respect to
conversion
The cost to manufacture one…
Heitger Company is a job-order costing firm that uses activity-based costing to apply overhead to jobs. Heitger identified three overhead activities and related drivers. Budgeted information for the year is as follows:
Activity
Cost
Driver
Amount of Driver
Materials handling
$91,350
Number of moves
3,500
Engineering
120,900
Number of change orders
6,500
Other overhead
392,700
Direct labor hours
51,000
Heitger worked on four jobs in July. Data are as follows:
Job 13-43
Job 13-44
Job 13-45
Job 13-46
Beginning balance
$23,000
$18,700
$4,700
$0
Direct materials
$5,300
$9,350
$13,100
$9,900
Direct labor cost
$970
$1,050
$1,520
$100
Job 13-43
Job 13-44
Job 13-45
Job 13-46
Number of moves
41
53
28
6
Number of change orders
30
44
24
15
Direct labor hours
970
1,050
1,520
100
By July 31, Jobs 13-43 and 13-44 were completed and sold. Jobs 13-45 and 13-46 were still in process.
Required:…
Chapter 10 Solutions
Managerial Accounting: Tools for Business Decision Making
Ch. 10 - Prob. 1QCh. 10 - The following purposes are part of a budgetary...Ch. 10 - How may a budget report for the second quarter...Ch. 10 - Ken Bay questions the usefulness of a master sales...Ch. 10 - Under what circumstances may a static budget be an...Ch. 10 - A flexible budget is really a series of static...Ch. 10 - The static manufacturing overhead budget based on...Ch. 10 - A static overhead budget based on 40,000 direct...Ch. 10 - Megan Pedigo is confused about how a flexible...Ch. 10 - Call Company has prepared a graph of flexible...
Ch. 10 - The flexible budget formula is fixed costs 50,000...Ch. 10 - What is management by exception? What criteria may...Ch. 10 - What is responsibility accounting? Explain the...Ch. 10 - Prob. 14QCh. 10 - Distinguish between controllable and...Ch. 10 - How do responsibility reports differ from budget...Ch. 10 - Prob. 17QCh. 10 - Distinguish among the three types of...Ch. 10 - Prob. 19QCh. 10 - Prob. 20QCh. 10 - Prob. 21QCh. 10 - Prob. 22QCh. 10 - Prob. 23QCh. 10 - Prob. 24QCh. 10 - Prob. 25QCh. 10 - Prob. 26QCh. 10 - For the quarter ended March 31, 2017, Croix...Ch. 10 - Data for Croix Company are given in BE10-1. In the...Ch. 10 - In Rooney Company, direct labor is 20 per hour....Ch. 10 - Gundy Company expects to produce 1,200,000 units...Ch. 10 - Data for Gundy Company are given in BE10-4. In...Ch. 10 - In the Assembly Department of Hannon Company,...Ch. 10 - Torres Company accumulates the following summary...Ch. 10 - For the year ending December 31, 2017, Cobb...Ch. 10 - Prob. 10.9BECh. 10 - Prob. 10.10BECh. 10 - Prob. 10.11BECh. 10 - Prob. 10.12BECh. 10 - Wade Company estimates that it will produce 6,000...Ch. 10 - In Pargo Company's flexible budget graph, the...Ch. 10 - Prob. 10.3DICh. 10 - Prob. 10.4DICh. 10 - Connie Rice has prepared the following list of...Ch. 10 - Crede Company budgeted selling expenses of 30,000...Ch. 10 - Myers Company uses a flexible budget for...Ch. 10 - Using the information in E10-3. assume that in...Ch. 10 - Fallon Company uses flexible budgets to control...Ch. 10 - The actual selling expenses incurred in March 2017...Ch. 10 - Appliance Possible Inc. (AP) is a manufacturer of...Ch. 10 - Rensing Groomers is in the dog-grooming business....Ch. 10 - As sales manager, Joe Batista was given the...Ch. 10 - Chubbs Inc.'s manufacturing overhead budget for...Ch. 10 - UrLink Company is a newly formed company...Ch. 10 - Venetian Company has two production departments....Ch. 10 - Fey Company's Organization chart includes the...Ch. 10 - The Mixing Department manager of Malone Company is...Ch. 10 - Horatio Inc. has three divisions which are...Ch. 10 - The Sports Equipment Division of Harrington...Ch. 10 - The South Division of Wiig Company reported the...Ch. 10 - The Dinkle and Frizell Denial Clinic provides both...Ch. 10 - The Ferrell Transportation Company uses a...Ch. 10 - Presented below is selected information for three...Ch. 10 - Presenled below is selected financial information...Ch. 10 - Bumblebee Company estimates that 300,000 direct...Ch. 10 - Zelmer Company manufactures tablecloths. Sales...Ch. 10 - Ratchet Company uses budgets in controlling costs....Ch. 10 - Clarke Inc. operates the Patio Furniture Division...Ch. 10 - Optimus Company manufactures a variety of tools...Ch. 10 - Durham Company uses a responsibility reporting...Ch. 10 - Sentinel Industries has manufactured prefabricated...Ch. 10 - CURRENT DESIGNS The Current Designs staff has...Ch. 10 - Green Pastures is a 400-acre farm on the outskirts...Ch. 10 - Prob. 10.2BYPCh. 10 - Prob. 10.3BYPCh. 10 - The manufacturing overhead budget for Fleming...Ch. 10 - Ethics Case American Products Corporation...Ch. 10 - Considering Your Costs and Benefits Preparing a...
Additional Business Textbook Solutions
Find more solutions based on key concepts
Revenue recognition principle Revenue recognition principle states that every business organization should reco...
Horngren's Financial & Managerial Accounting, The Financial Chapters (Book & Access Card)
Do companies always reclassify long-term debt that becomes callable by the creditor a short-term obligation? Ex...
Intermediate Accounting
Fundamental and Enhancing Characteristics. Identify whether the following items are fundamental characteristics...
Intermediate Accounting (2nd Edition)
E5-18 Using accounting vocabulary
Learning Objectives 1, 2,3
Match the accounting terms with the corresponding ...
Horngren's Accounting (11th Edition)
Indicate what impact the following transactions would have on the accounting equation, . Table 3.10
Principles of Accounting Volume 1
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- John Sheng, a cost accountant at Starlet Company, is developing departmental factory overhead application rates for the companys Tooling and Fabricating departments. The budgeted overhead for each department and the data for one job are as follows: Using the departmental overhead application rates, total overhead applied to Job 231 in the Tooling and Fabricating departments will be: a. 225. b. 303. c. 537. d. 671.arrow_forwardDirect labor hours are estimated as 2,000 in Quarter 1; 2,100 in Quarter 2; 1,900 in Quarter 3; and 2,300 in Quarter 4. Prepare a manufacturing overhead budget using the information provided.arrow_forwardGHT Tech Inc. sells electronics over the Internet. The Consumer Products Division is organized as a cost center. The budget for the Consumer Products Division for the month ended January 31 is as follows: During January, the costs incurred in the Consumer Products Division were as follows: Instructions 1. Prepare a budget performance report for the director of the Consumer Products Division for the month of January. 2. For which costs might the director be expected to request supplemental reports?arrow_forward
- Minor Co. has a job order cost system and applies overhead based on departmental rates. Service Department 1 has total budgeted costs of 168,000 for next year. Service Department 2 has total budgeted costs of 280,000 for next year. Minor allocates service department costs solely to the producing departments. Service Department 1 cost is allocated to producing departments on the basis of machine hours. Service Department 2 cost is allocated to producing departments on the basis of direct labor hours. Producing Department 1 has budgeted 8,000 machine hours and 12,000 direct labor hours. Producing Department 2 has budgeted 2,000 machine hours and 12,000 direct labor hours. What is the total cost allocation from the two service departments to Producing Department 1? a. 173,600 b. 140,000 c. 134,400 d. 274,400arrow_forwardDouglas Davis, controller for Marston, Inc., prepared the following budget for manufacturing costs at two different levels of activity for 20X1: During 20X1, Marston worked a total of 80,000 direct labor hours, used 250,000 machine hours, made 32,000 moves, and performed 120 batch inspections. The following actual costs were incurred: Marston applies overhead using rates based on direct labor hours, machine hours, number of moves, and number of batches. The second level of activity (the right column in the preceding table) is the practical level of activity (the available activity for resources acquired in advance of usage) and is used to compute predetermined overhead pool rates. Required: 1. Prepare a performance report for Marstons manufacturing costs in the current year. 2. Assume that one of the products produced by Marston is budgeted to use 10,000 direct labor hours, 15,000 machine hours, and 500 moves and will be produced in five batches. A total of 10,000 units will be produced during the year. Calculate the budgeted unit manufacturing cost. 3. One of Marstons managers said the following: Budgeting at the activity level makes a lot of sense. It really helps us manage costs better. But the previous budget really needs to provide more detailed information. For example, I know that the moving materials activity involves the use of forklifts and operators, and this information is lost when only the total cost of the activity for various levels of output is reported. We have four forklifts, each capable of providing 10,000 moves per year. We lease these forklifts for five years, at 10,000 per year. Furthermore, for our two shifts, we need up to eight operators if we run all four forklifts. Each operator is paid a salary of 30,000 per year. Also, I know that fuel costs about 0.25 per move. Assuming that these are the only three items, expand the detail of the flexible budget for moving materials to reveal the cost of these three resource items for 20,000 moves and 40,000 moves, respectively. Based on these comments, explain how this additional information can help Marston better manage its costs. (Especially consider how activity-based budgeting may provide useful information for non-value-added activities.)arrow_forwardCalculating Departmental Overhead Rates and Applying Overhead to Production At the beginning of the year, Glaser Company estimated the following. Glaser uses departmental overhead rates. In the assembly department,overhead is applied on the basis of direct labor hours. In the testingdepartment, overhead is applied on the basis of machine hours. Actualdata for the month of March are as follows 1. Calculate the predetermined overhead rates for the assemblyand testing departments.2. Calculate the overhead applied to production in eachdepartment for the month of March.3. By how much has each department's overhead beenoverapplied? Underapplied?arrow_forward
- Products uses a job-costing system with two direct-cost categories (direct materials and direct manufacturing labor) and one manufacturing overhead cost pool. Davey allocates manufacturing overhead costs using direct manufacturing labor costs.Davey provides the following information: Budget for 2017 Actual Results for 2017 Direct material costs 2,050,000 1,975,000 Direct manufacturing labor costs 1,600,000 1,550,000 Manufacturing overhead costs 2,880,000 2,945,000 1. Compute the actual and budgeted manufacturing overhead rates for 2017. 2. During March, the job-cost record for Job 626 contained the following information: Direct materials used $50,000 Direct manufacturing labor costs $40,000 Compute the cost of Job 626 using (a) actual costing and (b) normal costing. 3. At the end of 2017, compute the under- or overallocated manufacturing overhead under normal costing. Why is there no…arrow_forwardTillman Corporation uses a Job Order Costing system and has two production departments--Molding and Assembly. The company applies manufacturing overhead to production orders on the basis of direct labor costs. Separate departmental predetermined overhead rates are used. Budgeted manufacturing costs for the year are as follows: Molding Assembling Direct Materials P700,000 P100,000 Direct Labor 200,000 800,000 Manufacturing Overhead 600,000 400,000 The actual material and labor costs charged to Job 432 were as follows: Direct Materials 25,000 Direct Labor Molding 8,000 Assembling 12,000 20,000 Tillman applies manufacturing overhead to production orders on the basis of direct labor cost using a departmental rate predetermined at the beginning of the year based on the annual budget. The total manufacturing cost associated with Job 432 should be?arrow_forwardSmith Manufacturing currently allocates manufacturing overhead costs by plantwide overhead rate using direct labor costs. Ben Smith, a controller argues for departmental overhead rates to allocate manufacturing overhead costs to products. For department overhead rates, manufacturing overhead costs are allocated on the basis of machine-hours in the Machining Department and on the basis of direct labor costs in the Assembly Department. At the beginning of 20X3, the following estimates were provided for the coming year: Machining Assembly Direct labor-hours 30,000 60,000 Machine-hours 80,000 20,000 Direct labor cost $500,000 $900,000 Manufacturing overhead costs $420,000 $240,000 During month of the March, the accounting records of the company show the following data for Job #316: Machining Assembly Direct labor-hours 120 70 Machine-hours 60 5 Direct material cost $300 $200 Direct labor cost $100 $400 1) For Plant-wide Overhead Rate, a. Compute the plant-wide manufacturing…arrow_forward
- The controller of Hendershot Corporation estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below: Wall Specialty Mirrors Windows Total expected units produced Total expected material moves Expected direct labor-hours per unit 11,900 1,710 1,190 1,610 8 The total materials handling cost for the year is expected to be $17,148.7O. If the materials handling cost is allocated on the basis of material moves, the total materials handling cost allocated to the specialty windows is closest to: (Round your intermediate calculations to 4 decimal places.)arrow_forwardJohn Sheng, a cost accountant at Starlet Company, is developing departmental factory overhead application rates for the company's Tooling and Fabricating departments. The budgeted overhead for each department and the data for one job are as follows: Departments Fabricating Tooling $ 850 $ 200 Supplies Supervisors' salaries 1,500 2,000 Indirect labor 1,200 4,880 Depreciation 1,000 5,500 Repairs 4,075 3,540 Total budgeted overhead $8,625 $16,120 Total direct labor hours 460 620 Direct labor hours on Job 231 12 3 Using the departmental overhead application rates, total overhead applied to Job 231 in the Tooling and Fabricating departments will be: a. $225. b. $303. c. $537. d. $671.arrow_forwardARKANSAS CORPORATION …… is a company that produces machinery to customer order. Its job costing system, using normal costing, has two direct cost categories, direct materials and direct labor, and one indirect cost pool, manufacturing overhead, allocated using a budgeted rate based on direct labor costs. Budgeted and actual information for 2016 are as follows: Budget Actual Direct Labor $420,000 $400,000 Manufacturing overhead $252,000 $186,840 At the end of 2016, the ending work in process consisted of: Ending Work In Process: Direct Materials $64,000 Direct Labor 50,000 Overhead 30,000 $144,000 There were no beginning work-in-process or finished-goods inventories. Ending Finished Goods showed a balance of $156,000, which included overhead costs of $25,200. Cost of goods sold was $1,600,000, of which $184,800 consisted of applied overhead.…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Responsibility Accounting| Responsibility Centers and Segments| US CMA Part 1| US CMA course; Master Budget and Responsibility Accounting-Intro to Managerial Accounting- Su. 2013-Prof. Gershberg; Author: Mera Skill; Rutgers Accounting Web;https://www.youtube.com/watch?v=SYQ4u1BP24g;License: Standard YouTube License, CC-BY