FUNDAMENTALS OF...(LL)-W/ACCESS>CUSTOM<
6th Edition
ISBN: 9781264749225
Author: LANEN
Publisher: MCG CUSTOM
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 6, Problem 33E
Basic Product Costing
Big City Bank processes the checks its customers write at Riverdale Operations Center (ROC). ROC processed 2,800,000 checks in September. It takes only seconds to process a check, so none are left unprocessed at the end of the day. ROC cost data from September show the following costs:
Required
Compute the cost per processed check for September at ROC.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Harmon Recycling Services (HRS), a not-for-profit organization, has two drop-off centers, Westside and Eastside. Data for the expected
operation in the next quarter follow.
Clients
Revenues
Eastside
25,000
$360,000
8,100
Westside
6,250
$ 240,000
2,700
$ 99,000 $ 108,000
Staff hours
Staff costs
General operating costs
Required:
a. Compute the predetermined overhead rate used to apply general operating costs to the two centers assuming HRS uses the
number of clients to allocate general operating costs.
b. Based on the rates computed in requirement (a), what is the expected surplus (revenues less costs) for each center?
Required A Required B
Complete this question by entering your answers in the tabs below.
Predetermined overhead rate
Total
31,250
$ 600,000
10,800
$ 207,000
$360,000
Compute the predetermined overhead rate used to apply general operating costs to the two centers assuming HRS uses the
number of clients to allocate general operating costs.
Note: Round your answer to 2…
Harmon Recycling Services (HRS), a not-for-profit organization, has two drop-off centers, Westside and Eastside. Data for the expected
operation in the next quarter follow.
Clients
Revenues
Staff hours
Staff costs
General operating costs
Eastside
25,000
$ 330,000
8,100
$ 99,000
Required A Required B
Westside
6,250
$ 220,000
2,700
$ 99,000
Required:
a. Compute the predetermined overhead rate used to apply general operating costs to the two centers assuming HRS uses the
number of clients to allocate general operating costs.
b. Based on the rates computed in requirement (a), what is the expected surplus (revenues less costs) for each center?
Predetermined overhead rate
Total
31,250
$ 550,000
10, 800
Complete this question by entering your answers in the tabs below.
$ 198,000
$ 330,000
per client
Compute the predetermined overhead rate used to apply general operating costs to the two centers assuming HRS uses the
number of clients to allocate general operating costs.
Note: Round your…
Red Industries produces computers and goes through two operations, Assembling and Packaging
before it is ready to be sold to customers. Next year's expected costs and activities are shown below.
Data for Dept.
Overhead
costs
Assembling
Direct
labor 401,000 DLH 99,000
hours
Machine
hours
Packaging
$ 586,600
72,000 MH 80,000 MH
DLH
$
413,400
1. Compute Red's departmental overhead rate for the Assembling department based on direct labor
hours.
2. Compute Red's departmental overhead rate for the Packaging department based on machine hours.
3, Compute a single plantwide rate based on machine hours.
Show your work with an Excel spreadsheet or in a Word file.
Chapter 6 Solutions
FUNDAMENTALS OF...(LL)-W/ACCESS>CUSTOM<
Ch. 6 - How are product costing and cost allocation...Ch. 6 - What are the three criteria for the design of cost...Ch. 6 - Why are cost flow diagrams useful in describing...Ch. 6 - What are the characteristics of the following...Ch. 6 - How are job order, process, and operation costing...Ch. 6 - Describe the predetermined overhead rate. What is...Ch. 6 - Ideally, what does an allocation base reflect...Ch. 6 - What is two-stage cost allocation?Ch. 6 - What is continuous flow processing? Give at least...Ch. 6 - What is each component of the basic cost flow...
Ch. 6 - Cost allocation is arbitrary, so there is nothing...Ch. 6 - When designing a cost system, what points should...Ch. 6 - When is the basic cost flow model used? Give an...Ch. 6 - It is your first day at a new job and you talk...Ch. 6 - Rex Santos, a cost accountant, prepares a product...Ch. 6 - Prob. 16CADQCh. 6 - Identify a particular support function in a...Ch. 6 - Prob. 18CADQCh. 6 - Cost allocation bases are ideally based on a...Ch. 6 - Prob. 20CADQCh. 6 - Why might two companies in the same industry have...Ch. 6 - Is it possible for a company to have a two-stage...Ch. 6 - Your colleague says, If a company only has one...Ch. 6 - Basic Cost Flow Model Ralphs Mini-Mart store in...Ch. 6 - Basic Cost Flow Model Assume that the following...Ch. 6 - Basic Cost Flow Model Fill in the missing items...Ch. 6 - Prob. 27ECh. 6 - Prob. 28ECh. 6 - Basic Product Costing Enviro Corporation...Ch. 6 - Basic Product Costing Saras Sodas produces a...Ch. 6 - Basic Product Costing In June, Saras Sodas...Ch. 6 - Basic Product Costing In December, Saras Sodas...Ch. 6 - Basic Product Costing Big City Bank processes the...Ch. 6 - Basic Product Costing Lukes Lubricants starts...Ch. 6 - Basic Product Costing: Ethical Issues Old Tyme...Ch. 6 - Process Costing Sanchez Company produces paints....Ch. 6 - Process Costing Graham Petroleum produces oil. On...Ch. 6 - Process Costing Joplin Corporation produces syrups...Ch. 6 - Tiger Furnishings produces two models of cabinets...Ch. 6 - Refer to the data in Exercise 6-39. Compute the...Ch. 6 - Refer to the data in Exercise 6-39. Compute the...Ch. 6 - Refer to the data in Exercise 6-39. Draw the cost...Ch. 6 - Compute the predetermined overhead rate used to...Ch. 6 - Compute the predetermined overhead rate used to...Ch. 6 - Prob. 45ECh. 6 - Prob. 46ECh. 6 - The system is referred to as a two-stage cost...Ch. 6 - Channing uses a two-stage cost allocation system,...Ch. 6 - Operations Costing Howrley-David, Inc.,...Ch. 6 - Operations Costing S. Lee Enterprises produces two...Ch. 6 - Operations Costing Organic Grounds produces two...Ch. 6 - Refer to the data in Exercise 6-39. Compute the...Ch. 6 - Refer to the data in Exercise 6-39. Compute the...Ch. 6 - Refer to the data in Exercise 6-39. The president...Ch. 6 - Donovan Parents produces soccer shorts and...Ch. 6 - Owl-Eye Radiologists (OR) does various types of...Ch. 6 - Prob. 57PCh. 6 - Compute the predetermined overhead rate used to...Ch. 6 - Operations Costing Vermont Instruments...Ch. 6 - Operation Costing DiDonato Supplies manufactures...Ch. 6 - Account Analysis, Two-Stage Allocation, and...Ch. 6 - Product Costing, Cost Estimation, and Decision...
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
- Harmon Recycling Services (HRS), a not-for-profit organization, has two drop-off centers, Westside and Eastside. Data for the expected operation in the next quarter follow. Clients Revenues Staff hours Staff costs General operating costs Required: Eastside 25,000 $ 660,000 8,100 $ 99,000 Required A Required B Westside 6,250 $ 440,000 2,700 $ 198,000 a. Compute the predetermined overhead rate used to apply general operating costs to the two centers assuming HRS uses revenue to allocate general operating costs. b. Based on the rates computed in requirement (a), what is the expected surplus (revenues less costs) for each center? Complete this question by entering your answers in the tabs below. Predetermined overhead rate Total 31,250 $ 1,100,000 10,800 $ 297,000 $ 660,000 Compute the predetermined overhead rate used to apply general operating costs to the two centers assuming HRS uses revenue to allocate general operating costs. % of revenuearrow_forwardBugaboo Co. manufactures three types of cookies: Fluffs, Crinkles, and Snaps. The production process is relatively simple, and factory overhead costs are allocated to products using a single plantwide factory overhead rate based on direct labor hours. Information for the month of May, Bugaboo's first month of operations, follows: BudgetedUnit Volume Direct LaborHours Per Unit Fluffs 80,000 boxes 0.10 Crinkles 60,000 boxes 0.20 Snaps 20,000 boxes 0.50 Bugaboo has budgeted direct labor costs for May at $8.50 per hour. Budgeted direct materials costs for May are: Fluffs, $0.75/unit; Crinkles $0.40/unit; and Snaps $0.30/unit. Bugaboo's budgeted overhead costs for May are: Indirect labor $280,000 Utilities 65,000 Supplies 45,000 Depreciation 30,000 Total $420,000 i need to find the product cost per box of the three types of cookiesarrow_forwardBugaboo Co. manufactures three types of cookies: Fluffs, Crinkles, and Snaps. The production process is relatively simple, and factory overhead costs are allocated to products using a single plantwide factory overhead rate based on direct labor hours. Information for the month of May, Bugaboo's first month of operations, follows: BudgetedUnit Volume Direct LaborHours Per Unit Fluffs 80,000 boxes 0.10 Crinkles 60,000 boxes 0.20 Snaps 20,000 boxes 0.50 Bugaboo has budgeted direct labor costs for May at $8.50 per hour. Budgeted direct materials costs for May are: Fluffs, $0.75/unit; Crinkles $0.40/unit; and Snaps $0.30/unit. Bugaboo's budgeted overhead costs for May are: Indirect labor $280,000 Utilities 65,000 Supplies 45,000 Depreciation 30,000 Total $420,000 i need to find the plantwide factory overhead rate per direct labor hour, the product cost for each cookie typearrow_forward
- The Janesky Company has collected data on the manufacture of 7,844 robot grippers last month. The breakdown of total costs is shown below. They now need to plan for future months. Units sold last month Direct materials Direct labor 7,844 $344,763 $128,371 $176,873 $122,962 What would be the break even price to produce and sell 3,444 units in the coming month? Manufacturing variable overhead Selling and administrative costsarrow_forwardBugaboo Co. manufactures three types of cookies: Fluffs, Crinkles, and Snaps. The production process is relatively simple, and factory overhead costs are allocated to products using a single plantwide factory overhead rate based on direct labor hours. Information for the month of May, Bugaboo's first month of operations, follows: Budgeted Direct Labor Unit Volume Hours Per Unit Fluffs 80,000 boxes 0.10 Crinkles 60,000 boxes 0.20 Snaps 20,000 boxes 0.50 Bugaboo has budgeted direct labor costs for May at $8.50 per hour. Budgeted direct materials costs for May are: Fluffs, $0.75/unit; Crinkles $0.40/unit; and Snaps $0.30/unit. Bugaboo's budgeted overhead costs for May are: Indirect labor $280,000 Utilities 65,000 Supplies 45,000 Depreciation 30,000 Total $420,000 Round your answers to two decimal places, if necessary. a. Compute Bugaboo's plantwide factory overhead rate for May. per direct labor hour b. Compute the product cost in May for each type of cookie. Fluffs Crinkles Snaps Cost…arrow_forwardThe next two questions are based on the problem below. Question 1: How much is the cost of goods manufactured during the current month? * Kai Company uses a plantwide rate based on budgeted DL cost to apply its overhead. Budgeted overhead cost for the month amounted to P420,.000 and expected DL cost is P300,000. During the current month, the company worked on 4 jobs: Job 68 Job 69 Job 70 Job 71 Beginning WIP Direct materials used Direct labor cost P34.500 26,000 10,000 Р23,700 13,700 18,500 P15,000 8,350 3,000- PO 11,000 2,900 During the month, Jobs 68 and 69 were completed, but only job 69 was sold. There was no beginning finished goods inventory at the start of the current month. O a. 84,500 O b. 126,500 c. 166,300 O d. 303,360 Touch here to edi-arrow_forward
- Angler Industries produces a product which goes through two operations, Assembly and Finishing, before it is ready to be shipped. Next year's expected costs and activities are shown below. Assembly 248,888 DLH Finishing 154,000 DLH 68,000 MH 448,800 MH $440,000 Direct labor hours Machine hours Overhead costs Assume that Angler Industries allocates overhead using a plantvide overhead rate based on machine hours. How much total overhead will be assigned to a product that requires 1 direct labor hour and 3.90 machine hours in the Assembly Department, and 4.00 direct labor hours and 0.6 machine hours in the Finishing Department? Multiple Chaises O O O $21.50 $17.60 $2.00. $18.10 $ 677,680 $13.20.arrow_forwardTraya Corp.'s management keeps track of the time it takes to process orders. During the most recent month, the following average times were recorded per order: Wait time is 10.6 days; Inspection time 0.2 day; Process time 2.6 days; Move time 0.6 days; Queue 3.2 days. a. Compute the throughput time b. Compute the manufacturing cycle efficiency c. What percentage of the production time is spent in non-value added activities? d. Compute the delivery cycle time With solution plsarrow_forwardOffice Products Inc. manufactures and sells various high-tech office automation products. Two divisions of Office products Inc. are the Computer Chip Division and the Computer Division. The Computer Chip Division manufactures one product, a "super chip," that can be used by both the Computer Division and other external customers. The following information is available on this month's operations in the Computer Chip Division: Selling price per chip Variable cost per chip Fixed production cost Fixed SG & A costs Monthly capacity External sales Internal sales $50 $20 $60,000 $90,000 $30 $45 $35 $50 10,000 chips 6,000 chips 0 chips Presently the Computer Division purchases no chips from the Computer Chip Division, but instead pays $45 to an external supplier for the 4,000 chips it needs each month. Assume that next month's costs and levels of operation in the Computer and the Computer Chip Divisions are similar to this month. What is the maximum of the transfer price range for a possible…arrow_forward
- Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor-hours. In the most recent month, 110,000 items were shipped to customers using 3,500 direct labor-hours. The company incurred a total of $9,450 in variable overhead costs. According to the company’s standards, 0.03 direct labor-hours are required to fulfill an order for one item and the variable overhead rate is $2.75 per direct labor-hour. Required: 4. What is the variable overhead rate variance and the variable overhead efficiency variance? (For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no…arrow_forwardAn overhead cost budget for the next month is being prepared by Ebony Supply Company. Past studies indicate that costs have followed behavior patterns as follows: Variable Cost per Direct Labor Hour Indirect materials and supplies P 0.77 Heat, light and power 1.50 Repairs and maintenance 5.00 Lubricants 0.65 In addition, management estimated the total fixed factory overhead at P.248,000, based on a normal capacity of 80,000 direct labor hours. Required: How much is the total factory overhead rate per hour to bel charged (applied) to production? b. If the company plans to manufacture 280,000 units of product next year, how much will be the total variable overhead costs, assuming that four units are produced per direct labor hour? Assuming the same data in b, how much will be the total budgeted fixed overhead costs? d. Assuming the same data as in b, how much factory overhead will be charged to Work-in process? e. Assuming further that the total actual factory overhead in d is P800,000,…arrow_forwardAngle Max Industries produces a product which goes through two operations, Assembly and Finishing, before it is ready to be shipped. Next year's expected costs and activities are shown below. Direct labor hours Machine hours Overhead costs Multiple Choice Assume that the Assembly Department allocates overhead using a plantwide overhead rate based on machine hours. How much total overhead will be assigned to a product that requires 2 direct labor hour and 3.30 machine hours in the Assembly Department, and 4.50 direct labor hours and 0.4 machine hours in the Finishing Department? O$17.60. Assembly 180,000 DLH 380,000 MH $380,000 $20.40. Finishing 148,000 DLH 91, 200 MH $562, 400arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education
What is variance analysis?; Author: Corporate finance institute;https://www.youtube.com/watch?v=SMTa1lZu7Qw;License: Standard YouTube License, CC-BY