Lasser Company plans to produce 29,000 units next period at a denominator activity of 87,000 direct labor-hours. The direct labor wage rate is $12.00 per hour. The company's standards allow 2 yards of direct materials for each unit of product; the material costs $7.90 per yard. The company's budget includes variable manufacturing overhead cost of $2.00 per direct labor-hour and fixed manufacturing overhead of $487,200 per period.
Required:
1. Using 87,000 direct labor-hours as the denominator activity, compute the predetermined overhead rate and break it down into variable and fixed elements.
Using 87,000 direct labor-hours as the denominator activity, compute the predetermined overhead rate and break it down into variable and fixed elements. (Round your answers to 2 decimal places.)
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2. Complete the standard cost card below for one unit of product.
Complete the standard cost card below for one unit of product: (Except standard hours, round your intermediate calculations and final answers to 2 decimal places.)
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Required 1: | |
Predetermined overhead rate ( 2.00 + 5.60 ) | 7.60 |
Variable element | 2.00 |
Fixed element ( 487200 / 87000 ) | 5.60 |
Required 2 : | |
Standard direct labor hours per unit = Budgeted direct labor hours / Budgeted units = 87000 / 29000 | 3 |
(1) | (2) | (1) x (2) | |||
Inputs | Standard quantity or hours | Standard price or rate | Standard cost | ||
Direct materials | 2 | yards | 7.90 | per yard | 15.80 |
Direct labor | 3 | hours | 12.00 | per hour | 36.00 |
Variable manufacturing overhead | 3 | hours | 2.00 | per hour | 6.00 |
Fixed manufacturing overhead | 3 | hours | 5.60 | per hour | 16.80 |
Total standard cost per unit | 74.60 |
Lasser Company plans to produce 29,000 units next period at a denominator activity of 87,000 direct...
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Lasser Company plans to produce 23,000 units next period at a
denominator activity of 69,000 direct labor-hours. The direct labor
wage rate is $12.00 per hour. The company's standards allow 2 yards
of direct materials for each unit of product; the material costs
$7.70 per yard. The company's budget includes variable
manufacturing overhead cost of $1.90 per direct labor-hour and
fixed manufacturing overhead of $372,600 per period.
Required:
1. Using 69,000 direct labor-hours as the denominator activity,
compute the predetermined...
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predetermined overhead rate on the basis of direct labor-hours. The
following data are taken from the company’s planning budget for the
current year:
Denominator activity (direct labor-hours)
12,000
Variable manufacturing overhead cost
$
37,200
Fixed manufacturing overhead cost
$
103,200
The standard cost card for the company’s only product is given
below:
Required:
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manufacturing overhead per unit and the...
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