Question
In: Accounting
Craft Pro Machining produces machine tools for the construction industry. The following details about overhead costs...
Craft Pro Machining produces machine tools for the construction
industry. The following details about overhead costs were taken
from its company records.
| Production Activity | Indirect Labor | Indirect Materials | Other Overhead | ||||||||
| Grinding | $ | 380,000 | |||||||||
| Polishing | $ | 145,000 | |||||||||
| Product modification | 650,000 | ||||||||||
| Providing power | $ | 240,000 | |||||||||
| System calibration | 510,000 | ||||||||||
Additional information on the drivers for its production activities
follows.
| Grinding | 18,000 | machine hours |
| Polishing | 18,000 | machine hours |
| Product modification | 2,000 | engineering hours |
| Providing power | 17,000 | direct labor hours |
| System calibration | 450 | batches |
| Job 3175 | Job 4286 | |||
| Number of units | 120 | units | 1,500 | units |
| Machine hours | 450 | MH | 4,500 | MH |
| Engineering hours | 28 | eng. hours | 26 | eng. hours |
| Batches | 25 | batches | 75 | batches |
| Direct labor hours | 510 | DLH | 4,590 | DLH |
Required:
5. If the company uses a plantwide overhead rate based on
direct labor hours, what is the overhead cost for each unit of Job
3175? Of Job 4286? (Do not round intermediate calculations.
Round "OH Cost per unit" answers to 2 decimal places.)
Solutions
Expert Solution
| Production Activity | Indirect Labor | Indirect Materials | Other Overhead | Total Overheads |
| Grinding | 380,000 | 380,000 | ||
| Polishing | 145,000 | 145,000 | ||
| Product modification | 650,000 | 650,000 | ||
| Providing power | 240,000 | 240,000 | ||
| System calibration | 510,000 | 510,000 | ||
| Total | $1,925,000 |
Total direct labor hours = 17,000 direct labor hours
Predetermined overhead rate = Total overheads/ Total direct labor hours
= 1,925,000/17,000
= $113.235294
Direct labor hours used in Job 3175 = 510
Overhead applied to Job 3175 = direct labor hours used in Job 3175 x Predetermined overhead rate
= 510 x 113.235294
= $57,750
Overhead per unit of Job 3175 = Overhead applied to Job 3175 / Number of units
= 57,750/120
= $481.25
Direct labor hours used in Job 4286= 4,590
Overhead applied to Job 4286= direct labor hours used in Job 4286x Predetermined overhead rate
= 4,590 x 113.235294
= $519,750
Overhead per unit of Job 4286= Overhead applied to Job 4286/ Number of units
= 519,750/1,500
= $346.50
ekkarill92 answered 1 year agoRelated Solutions
Craft Pro Machining produces machine tools for the construction industry. The following details about overhead costs...
Craft Pro Machining produces machine tools for the construction
industry. The following details about overhead costs were taken
from its company records.
Production Activity
Indirect Labor
Indirect Materials
Other Overhead
Grinding
$
380,000
Polishing
$
145,000
Product modification
650,000
Providing power
$
240,000
System calibration
510,000
Additional information on the drivers for its production activities
follows.
Grinding
18,000
machine hours
Polishing
18,000
machine hours
Product modification
2,000
engineering hours
Providing power
17,000
direct labor hours
System calibration
450
batches
Job...
Craft Pro Machining produces machine tools for the construction industry. The following details about overhead costs...
Craft Pro Machining produces machine tools for the construction
industry. The following details about overhead costs were taken
from its company records.
Production Activity
Indirect Labor
Indirect Materials
Other Overhead
Grinding
$
390,000
Polishing
$
125,000
Product modification
450,000
Providing power
$
240,000
System calibration
500,000
Additional information on the drivers for its production activities
follows.
Grinding
17,000
machine hours
Polishing
17,000
machine hours
Product modification
1,300
engineering hours
Providing power
20,000
direct labor hours
System calibration
1,100
batches
Job...
11. Craft Pro Machining produces machine tools for the construction industry. The following details about overhead...
11.
Craft Pro Machining produces machine tools for the construction
industry. The following details about overhead costs were taken
from its company records.
Production Activity
Indirect Labor
Indirect Materials
Other Overhead
Grinding
$
390,000
Polishing
$
200,000
Product modification
450,000
Providing power
$
220,000
System calibration
570,000
Additional information on the drivers for its production activities
follows.
Grinding
9,000
machine hours
Polishing
9,000
machine hours
Product modification
1,800
engineering hours
Providing power
17,000
direct labor hours
System calibration
900
batches...
Required information [The following information applies to the questions displayed below.] Craft Pro Machining produces machine...
Required information
[The following information applies to the questions
displayed below.]
Craft Pro Machining produces machine tools for the construction
industry. The following details about overhead costs were taken
from its company records.
Production Activity
Indirect Labor
Indirect Materials
Other Overhead
Grinding
$
340,000
Polishing
$
170,000
Product modification
450,000
Providing power
$
205,000
System calibration
580,000
Additional information on the drivers for its production activities
follows.
Grinding
13,000
machine hours
Polishing
13,000
machine hours
Product modification
1,900
engineering hours...
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Mariposa has the following data for its two departments for the
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Department A
Department B
Overhead costs (expected)
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$144,000
Normal activity (machine hours)
120,000
60,000
Required:
1.
Compute a predetermined overhead rate for the plant as...
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Mariposa, Inc., produces machine tools and currently uses a
plantwide overhead rate, based on machine hours. Harry Whipple, the
plant manager, has heard that departmental overhead rates can offer
significantly better cost assignments than can a plantwide
rate.
Mariposa has the following data for its two departments for the
coming year:
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Department B
Overhead costs (expected)
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