1. Answer: d. 75%
Budgeted overhead rate = Budgeted overheads/Budgeted direct labor dollars = ($44000 + $31000)/100000 = $75000/100000 = 75% of direct labor dollars
2. Answer: d. $490,400
Actual manufacturing costs: | |
Direct materials used | 300000 |
Direct labor | 110400 |
Variable factory overhead | 45000 |
Fixed factory overhead | 35000 |
Actual manufacturing costs $ | 490400 |
3. Answer: b. $2,800 over allocated
Overhead allocated = 75% x $110400 = $82800
Actual overheads = $45000 + $35000 = $80000
Overhead allocated $82800 - Actual overheads $80000 = Over allocated overhead $2800
4. Answer: d. under stated by $2,800
Since the overheads are over allocated, the cost of goods sold is over stated and hence the net income is under stated.
5. Answer: a. $6,285
Budgeted overhead rate = Budgeted overheads/Budgeted direct labor hours = ($44000 + $31000)/20000 = $75000/20000 = $3.75 per direct labor hour
Overhead applied to job 100 = 1676 x $3.75 = $6285
6. Answer: d. $56,001
Job 200 | |
Direct materials used | 25425 |
Direct labor cost used | 17472 |
Overheads (75% x $17472) | 13104 |
Total manufacturing cost $ | 56001 |
Part II - Job Costing Use the information below to answer the following questions: County Lawn...
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The Lowell Company uses a normal job-costing system at its Minneapolis plant. The plant has a machining department and an assembly department. Its job-costing system has two direct-cost categories (direct materials and direct manufacturing labor, and two manufacturing overhead cost pools (the machining department overhead allocated to jobs based on actual machine-hours, and the assembly department overhead, allocated to jobs based on actual direct manufacturing labor costs). The 2017 budget for the plant is as follows: (Click the icon to...
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