Homework Answers
Answer
Total product costs
Explanation -
Total manufacturing overhead cost can be distributed on the following basis -
Direct labour hours
Machine hours
Direct labour dollars
As all these provide the base on which total manufacturing overhead can be distributed and allocated as all these provide the basic area based on which manufacturing overhead can be distributed.
Total product cost is not a base based on which manufacturing overhead can be distributed. As total manufacturing overhead cost is equal to
Total direct material cost + total labour cost + total manufacturing overhead cost.
So, total manufacturing overhead cant be allocated based on total product cost as product costs cant be determined without manufacturing overhead cost.
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Amberjack Company is trying to decide on an allocation base to use to assign manufacturing overhead...
Amberjack Company is trying to decide on an allocation base to
use to assign manufacturing overhead to jobs. The company has
always used direct labor hours to assign manufacturing overhead to
products, but it is trying to decide whether it should use a
different allocation base such as direct labor dollars or machine
hours.
Actual and estimated data for manufacturing overhead, direct
labor cost, direct labor hours, and machine hours for the most
recent fiscal year are summarized here:
Estimated...
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Amberjack Company is trying to decide on an allocation base to
use to assign manufacturing overhead to jobs. The company has
always used direct labor hours to assign manufacturing overhead to
products, but it is trying to decide whether it should use a
different allocation base such as direct labor dollars or machine
hours.
Actual and estimated data for manufacturing overhead, direct
labor cost, direct labor hours, and machine hours for the most
recent fiscal year are summarized here:
Estimated...
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