Assignment
Acton Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations.
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Estimated manufacturing overhead
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$202,600
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Estimated machine-hours
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2,000
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Actual manufacturing overhead
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$194,600
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Actual machine-hours
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1,930
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The estimates of the manufacturing overhead and of machine-hours were made at the beginning of the year for the purpose of computing the company's predetermined overhead rate for the year.
The overhead for the year was:
$7,091 overapplied
$909 overapplied
$-909 underapplied
$7,091 underapplied
Dagger Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the total estimated manufacturing overhead was $437,950. At the end of the year, actual direct labor-hours for the year were 22,000 hours, manufacturing overhead for the year was underapplied by $23,500, and the actual manufacturing overhead was $428,200. The predetermined overhead rate for the year must have been closest to:
$18.84 per direct labor-hour
$18.40 per direct labor-hour
$19.46 per direct labor-hour
$19.91 per direct labor-hour
Acton Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations.
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Estimated manufacturing overhead
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$361,260
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Estimated machine-hours
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2,700
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Actual manufacturing overhead
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$354,700
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Actual machine-hours
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2,660
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The estimates of the manufacturing overhead and of machine-hours were made at the beginning of the year for the purpose of computing the company's predetermined overhead rate for the year.
The applied manufacturing overhead for the year is closest to:
$355,190
$354,547
$353,829
$355,908
The Work in Process inventory account of a manufacturing Corporation shows a balance of $4,137 at the end of an accounting period. The job cost sheets of the two uncompleted jobs show charges of $700 and $280 for materials, and charges of $560 and $980 for direct labor. From this information, it appears that the Corporation is using a predetermined overhead rate, as a percentage of direct labor costs, of:
95%
220%
105%
280%
Cerrone Inc. has provided the following data for the month of July. The balance in the Finished Goods inventory account at the beginning of the month was $74,000 and at the end of the month was $67,500. The cost of goods manufactured for the month was $339,000. The actual manufacturing overhead cost incurred was $111,000 and the manufacturing overhead cost applied to jobs was $105,000. The adjusted cost of goods sold that would appear on the income statement for July is:
$351,500
$339,000
$345,000
$333,000
The Lee Corporation uses a job-order costing system. The following data were recorded for June:
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June 1
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Added During June
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Job Number
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Work in Process Inventory
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Direct Materials
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Direct Labor
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235
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$3,050
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$820
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$565
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236
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$2,110
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$1,180
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$1,345
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237
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$1,495
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$1,640
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$2,410
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238
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$1,075
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$2,270
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$3,130
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Overhead is charged to production at 80% of direct materials cost. Jobs 235, 237, and 238 were completed during June and transferred to finished goods. Jobs 235 and 238 have been delivered to customers. Actual manufacturing overhead was equal to manufacturing overhead applied. There were no Work in Process or Finished Goods inventories at the beginning of June.
Lee's Work in Process inventory balance on June 30 was:
$4,635
$5,579
$4,635
$11,089
Darrow Company uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Last year, the company worked 8,000 direct labor-hours and incurred $108,000 of actual manufacturing overhead cost. If overhead was underapplied by $1,920, the predetermined overhead rate for the company for the year must have been:
$13.74
$13.26
$13.98
$13.50
Crombie Inc. uses a job-order costing system in which any underapplied or overapplied overhead is closed out to cost of goods sold at the end of the month. The company has provided the following data for June:
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Direct materials
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46,500
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Direct labor cost
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76,500
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Manufacturing overhead cost incurred
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69,750
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Manufacturing overhead cost applied
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74,560
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Inventories:
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Beginning
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Ending
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Work in process
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$17,500
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$27,840
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Finished goods
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$69,080
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$35,700
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The unadjusted cost of goods sold (in other words, cost of goods sold before adjusting for any underapplied or overapplied overhead) for June is closest to:
$187,220
$215,790
$220,600
$197,560
Acton Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations.
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Estimated manufacturing overhead
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$73,440
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Estimated machine-hours
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1,800
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Actual manufacturing overhead
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$68,700
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Actual machine-hours
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1,710
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The estimates of the manufacturing overhead and of machine-hours were made at the beginning of the year for the purpose of computing the company's predetermined overhead rate for the year.
The predetermined overhead rate is closest to:
$40.18
$39.99
$40.80
$40.61
Hibshman Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. At the beginning of the most recently completed year, the company estimated the machine-hours for the upcoming year at 20,000 machine-hours. The estimated variable manufacturing overhead was $8.71 per machine-hour and the estimated total fixed manufacturing overhead was $250,500. The predetermined overhead rate for the recently completed year was closest to:
$9 per machine-hour
$13 per machine-hour
$21 per machine-hour
$13 per machine-hour
Activity rates from Mcelderry Corporation's activity-based costing system are listed below. The company uses the activity rates to assign overhead costs to products:
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Activity Cost Pool
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Activity Rate
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Processing customer orders
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$93.89
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per customer order
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Assembling products
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$1.98
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per assembly hour
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Setting up batches
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$52.78
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per batch
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Last year, Product Q06J involved 3 customer orders, 477 assembly hours, and 24 batches. How much overhead cost would be assigned to Product Q06J using the activity-based costing system?
$1,266.72
$639.54
$67,401.69
$2,492.85
Studler Corporation has an activity-based costing system with three activity cost pools-Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow:
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Overhead costs:
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Equipment expense
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125,500
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Indirect labor
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8,000
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Distribution of Resource Consumption Across Activity Cost Pools:
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Activity Cost Pools
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Processing
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Supervising
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Other
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Equipment expense
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0.60
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0.20
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$
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0.20
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Indirect labor
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0.10
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0.50
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0.40
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Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:
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Activity:
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MHs (Processing)
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Batches (Supervising)
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Product Y4
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3,000
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200
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Product R6
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17,000
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3,800
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Total
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20,000
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4,000
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The activity rate for the Supervising activity cost pool under activity-based costing is closest to:
$2.00 per batch
$32.65 per batch
$7.28 per batch
$2.13 per batch
Hochberg Corporation uses an activity-based costing system with the following three activity cost pools:
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Activity Cost Pool
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Total Activity
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Fabrication
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50,000
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machine-hours
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Order processing
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625
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orders
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Other
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Not applicable
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The Other activity cost pool is used to accumulate costs of idle capacity and organization-sustaining costs.
The company has provided the following data concerning its costs:
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Wages and salaries
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$
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425,000
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Depreciation
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133,000
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Occupancy
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170,000
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Total
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$
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728,000
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The distribution of resource consumption across activity cost pools is given below:
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Activity Cost Pools
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Fabricating
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Order Processing
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Other
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Total
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Wages and salaries
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5%
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65%
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30%
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100%
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Depreciation
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25%
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20%
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55%
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100%
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Occupancy
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5%
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65%
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30%
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100%
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The activity rate for the Fabrication activity cost pool is closest to:
$1.83 per machine-hour
$3.64 per machine-hour
$0.23 per machine-hour
$1.26 per machine-hour
Mussenden Corporation has an activity-based costing system with three activity cost pools-Machining, Order Filling, and Other. In the first stage allocations, costs in the two overhead accounts, equipment depreciation and supervisory expense, are allocated to three activity cost pools based on resource consumption. Data used in the first stage allocations follow:
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Overhead costs:
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Equipment depreciation
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$
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168,320
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Supervisory expense
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$
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2,940
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Distribution of Resource Consumption Across Activity Cost Pools:
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Activity Cost Pools
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Machining
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Order Filling
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Other
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Equipment depreciation
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0.60
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0.10
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0.30
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Supervisory expense
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0.50
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0.20
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0.30
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Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:
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Activity:
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MHs (Machining)
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Orders (Order Filling)
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Product P4
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9,360
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780
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Product S4
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16,640
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1,820
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Total
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26,000
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2,600
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How much overhead cost is allocated to the Order Filling activity cost pool under activity-based costing?
$16,832
$27,020
$588
$17,420
Forse Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:
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Overhead costs:
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Wages and salaries
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$
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111,000
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Other expenses
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49,000
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Total
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$
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160,000
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Distribution of resource consumption:
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Activity Cost Pools
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Making Bouquets
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Delivery
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Other
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Total
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Wages and salaries
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55%
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30%
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15%
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100%
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Other expenses
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25%
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50%
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25%
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100%
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The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.
The amount of activity for the year is as follows:
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Activity Cost Pool
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Activity
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Making bouquets
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41,410 bouquets
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Delivery
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13,700 deliveries
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What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the deliveries activity cost pool? (Round your final answer to 2 decimal places)
$3.79
$2.51
$5.08
$4.22