Chapter 2&3 HW Review Flashcards
Harris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 33,000 direct labor-hours would be required for the period’s estimated level of production. The company also estimated $552,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $2.00 per direct labor-hour. Harris’s actual manufacturing overhead cost for the year was $682,639 and its actual total direct labor was 33,500 hours.
Compute the company’s plantwide predetermined overhead rate for the year.
$18.73 per DLH
Luthan Company uses a plantwide predetermined overhead rate of $23.60 per direct labor-hour. This predetermined rate was based on a cost formula that estimated $283,200 of total manufacturing overhead cost for an estimated activity level of 12,000 direct labor-hours.
The company incurred actual total manufacturing overhead cost of $266,000 and 12,300 total direct labor-hours during the period.
Determine the amount of manufacturing overhead cost that would have been applied to all jobs during the period.
$290,280
Mickley Company’s plantwide predetermined overhead rate is $20.00 per direct labor-hour and its direct labor wage rate is $11.00 per hour. The following information pertains to Job A-500:
Direct materials $280
Direct labor $220
- What is the total manufacturing cost assigned to Job A-500?
- If Job A-500 consists of 70 units, what is the unit product cost for this job?
Total Manufacturing Cost: $900
Unit Product Cost: $12.86 per unit
Fickel Company has two manufacturing departments—Assembly and Testing & Packaging. The predetermined overhead rates in Assembly and Testing & Packaging are $22.00 per direct labor-hour and $18.00 per direct labor-hour, respectively. The company’s direct labor wage rate is $24.00 per hour. The following information pertains to Job N-60:
Assembly Testing & Packaging DM $390 $45 DL $228 $132
- What is the total manufacturing cost assigned to Job N-60?
- If Job N-60 consists of 10 units, what is the unit product cost for this job?
Total Manufacturing Cost: $1,103
Unit Product Cost: $110.30 per unit.
See Chapter 3 Foundational 15
15 parts- lots of info. Easier to just use textbook/notes.
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company’s inventory balances were as follows:
Raw materials $ 60,500
Work in process $ 20,800
Finished goods $ 57,600
The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the company’s predetermined overhead rate of $11.25 per direct labor-hour was based on a cost formula that estimated $450,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded for the year:
A) Raw materials were purchased on account, $622,000.
B) Raw materials used in production, $591,800. All of of the raw materials were used as direct materials.
C) The following costs were accrued for employee services: direct labor, $400,000; indirect labor, $150,000; selling and administrative salaries, $280,000.
D) Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $400,000.
E) Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $300,000.
F) Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year.
G) Jobs costing $1,360,750 to manufacture according to their job cost sheets were completed during the year.
H) Jobs were sold on account to customers during the year for a total of $3,330,000. The jobs cost $1,370,750 to manufacture according to their job cost sheets.
- What is the journal entry to record raw materials used in production?
Dr. Work in Process for $591,800
Cr. Raw Materials for $591,800
(See info in previous problem- Parts A-H)
What is the ending balance in Raw Materials?
Beginning Balance: $60,500
(a) $622,000
(b) -$591,800
Ending Balance= $90,700
See previous problem info.
What is the journal entry to record the labor costs incurred during the year?
Dr. Work in Process for $400,000
Dr. Manufacturing Overhead for $150,000
Dr. Selling and Administrative Salaries for $280,000
Cr. Wages Payable for $830,000
What is the total amount of manufacturing overhead applied to production during the year?
$461,250
What is the total manufacturing cost added to Work in Process during the year?
$1,453,050
What is the journal entry to record the transfer of completed jobs that is referred to in item g above?
Dr. Finished Goods for $1,360,750
Cr. Work in Process for $1,360,750
What is the ending balance in Work in Process?
Beginning Balance: $20,600
(b) $591,800
(c) $400,000
(f) $461,250
(g) -$1,360,750
Ending Balance $113,100
What is the total amount of actual manufacturing overhead cost incurred during the year?
$450,000
Is manufacturing overhead underapplied or overapplied for the year? By how much?
Overapplied Overhead by $11,250
What is the cost of goods available for sale during the year?
$1,418,350
