Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Textbook Question
Chapter 12, Problem 9E
Exercise 4-6A Allocating
Willey Company makes three products in its factory: plastic cups, plastic tablecloths, and plastic bottles. The expected overhead costs for the next fiscal year include the following:
| Factory manager’s salary | $210,000 |
| 70,000 | |
| Factory supplies | 20,000 |
| Total overhead costs | $300,000 |
Willey uses machine hours as the cost driver to allocate overhead costs. Budgeted machine hours for the products are as follows:
| Cups | 300 Hours |
| Tablecloths | 750 |
| Bottles | 950 |
| Total machine hours | 2,000 |
Required
a. Allocate the budgeted overhead costs to the products.
b. Provide a possible explanation as to why Willey chose machine hours, instead of labor hours, as the allocation base.
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fill in the blank 1
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0.25
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Prepare a manufacturing overhead budget if the number of units to produce for January, February, and March are 2,400, 2,900, and 2,700, respectively.
Spree Party Lights
Manufacturing Overhead Budget
For the Quarter Ending January - March
January
February
March
Units to Produce
fill in the blank 1
fill in the blank 2
fill in the blank 3
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Indirect Material
$fill in the blank 5
$fill in the blank 6
$fill in the blank 7
Indirect Labor
fill in the blank 9
fill in the blank 10
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Maintenance
fill in the blank 13
fill in the blank 14
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Utilities…
Single Plantwide Factory Overhead Rate
Scrumptious Snacks Inc. manufactures three types of snack foods: tortilla chips,
potato chips, and pretzels. The company has budgeted the following costs for the
upcoming period:
Factory depreciation
Indirect labor
Factory electricity
Indirect materials
Selling expenses
Administrative expenses
Total costs
Factory overhead is allocated to the three products on the basis of processing hours.
The products had the following production budget and processing hours per case:
Budgeted Volume
(Cases)
$9,442
23,400
2,668
5,542
13,137
7,389
$61,578
Tortilla chips
Potato chips
Pretzels
3,900
2,100
1,500
7,500
If required, round all per-case answers to the nearest cent.
Total
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0.12
0.15
0.10
a. Determine the single plantwide factory overhead rate.
per processing hour
Chapter 12 Solutions
Survey Of Accounting
Ch. 12 - 1.What is a cost object? Identify four different...Ch. 12 - Prob. 2QCh. 12 - 3.If the cost object is a manufactured product,...Ch. 12 - Prob. 4QCh. 12 - Prob. 5QCh. 12 - Prob. 6QCh. 12 - Prob. 7QCh. 12 - Prob. 8QCh. 12 - Prob. 9QCh. 12 - 10.Why are some manufacturing costs not directly...
Ch. 12 - Prob. 11QCh. 12 - 12.On January 31, the managers of Integra, Inc....Ch. 12 - 13.Respond to the following statement: The...Ch. 12 - Prob. 14QCh. 12 - Define the term cost pool. How are cost pools...Ch. 12 - LO 4-1Exercise 4-1A Direct versus indirect costs...Ch. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Exercise 4-4APooling overhead cost Ware...Ch. 12 - Prob. 5ECh. 12 - Exercise 4-5A Allocating overhead cost among...Ch. 12 - Prob. 7ECh. 12 - Prob. 8ECh. 12 - Exercise 4-6AAllocating overhead costs among...Ch. 12 - Exercise 4-9AAllocating to solve a timing problem...Ch. 12 - Prob. 11ECh. 12 - Exercise 4-11AHow the allocation of fixed cost...Ch. 12 - Prob. 13ECh. 12 - Problem 4-17A Cost accumulation and allocation...Ch. 12 - Problem 4-18A Selecting an appropriate cost driver...Ch. 12 - Problem 4-19A Cost allocation in a service...Ch. 12 - Prob. 17PCh. 12 - Problem 4-21A Allocation to accomplish smoothing...Ch. 12 - Problem 4-22A Allocating indirect costs between...Ch. 12 - Prob. 20PCh. 12 - Prob. 1ATCCh. 12 - Prob. 2ATCCh. 12 - ATC 4-3 Research Assignment Using real-world data...Ch. 12 - Prob. 4ATCCh. 12 - Prob. 5ATC
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