Assessment 1 - Standard Cost Summary and Related Journal Entries
The normal capacity of Central Manufacturing Company is 45,000 direct labor hours and 20,000 units per month. A finished unit requires 6 pounds of materials at an estimated cost of $2 per pound. The estimated cost of labor is $10 per hour. The plant estimates that overhead for a month will be $40,000. During the month of March, the plant totaled 41,800 direct labor hours at an average rate of $9.50 an hour. The plant produced 18,000 units, using 105,000 pounds of materials at a cost of $2.04 per pound.
Using this spreadsheet, prepare (a) a standard cost summary showing standard unit cost, and (b) journal entries to charge materials and labor to work-in-process.
Assessment 2 - Computing Activity-Based Costing Rates
The partners of Oops and Whynot, attorneys-at-law, decide to implement an activity-based costing system for their firm. They identify the following three cost pools and budgeted amounts for each for the coming year:
fringe benefits: $450,000
paralegal support: $300,000
research support:$750,000
It is determined that the best cost driver for each is as follows:
for fringe benefits: professional labor dollars - $1,800,000
for paralegal support: partner labor hours - 4,000
for research support: professional labor hours - 20,000.
Compute the budgeted overhead rates for each of the three cost pools.
Attachment:- Assignment Files.rar