Chapter 10A, Problem 10A.12P

1.

To determine

Compute predetermined overhead rate and fixed overhead and variable overhead if company has 30,000 direct labor hours.

Introduction: Standard costing means the accounting system which is used by manufacturers mainly to identify variances or difference that occur in cost. The difference is identified between actual cost of goods that were manufactured and those cost which should have occurred when actual goods were manufactured.

2.

To determine

Compute predetermined overhead rate and fixed overhead and variable overhead if company has 40,000 direct labor hours.

Introduction: Standard costing means the accounting system which is used by manufacturers mainly to identify variances or difference that occur in cost. The difference is identified between actual cost of goods that were manufactured and those cost which should have occurred when actual goods were manufactured.

3.

To determine

Compute two standard cost having activity of 30,000 direct labor hours and 40,000 direct labor hours.

Introduction: Standard costing means the accounting system which is used by manufacturers mainly to identify variances or difference that occur in cost. The difference is identified between actual cost of goods that were manufactured and those cost which should have occurred when actual goods were manufactured.