Problem 1 indirect cost application rates The Flintstones manufacturing company makes hammers that it sells to...

Problem 1 indirect cost application rates
The Flintstones manufacturing company makes hammers that it sells to hardware stores in the Northeast
country. For next year manufacturing overhead costs are expected to be $ 243,000
Estimated data:
The company expects a production of 175,000 hammers, 180,000 hours, for the following year
machine and 36,400 hours of direct labor. The estimated cost of direct materials is
estimated at $ 265,000 and the estimated cost of direct labor at $ 172,460.
The actual data for January were as follows:
24,000 hammers
25,000 machine hours
5,000 hours of direct labor
$ 44,020 direct materials costs
$ 25,000 direct labor costs
It asks:
Calculate rates to apply manufacturing overhead, and determine overhead
applied during January for each of the following bases:
1. Production units
2. MOD costs
3. Direct material costs
4. Machine hours
5. Hours of direct labor

Expert Solution

ekkarill92 answered 5 months ago

Department indirect-cost rates are never activity-cost rates.” Do you agree? Explain.

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