Question

In: Accounting

Bramble Company manufactures a line of lightweight running shoes. CEO Mark Bramble estimated that the company...

Bramble Company manufactures a line of lightweight running shoes. CEO Mark Bramble estimated that the company would incur $3,412,240 in manufacturing overhead during the coming year. Additionally, he estimated the company would operate at a level requiring 221,000 direct labor hours and 598,639 machine hours.

1) Assume that Bramble Company uses direct labor hours as its manufacturing overhead application base. Calculate the company’s predetermined overhead rate. (Round answer to 2 decimal places, e.g. 52.75.)

2) Assume that job 4375 required 400 direct labor hours to complete. How much manufacturing overhead should be applied to the job? (Round answer to 0 decimal places, e.g. 5,275.)

3) Assume that Bramble Company uses machine hours as its manufacturing overhead application base. Calculate the company’s predetermined overhead rate. (Round answer to 2 decimal places, e.g. 52.75.)

4)
Assume that job 4375 required 630 machine hours to complete. How much manufacturing overhead should be applied to the job? (Round answer to 0 decimal places, e.g. 5,275.)

Solutions

Expert Solution

Answer to Part 1.

Predetermined Overhead Rate = Estimated manufacturing overhead/Direct labor hours

                                                  =$3,412,240/221,000

                                                  =$15.44

Answer to Part 2.

Overhead Applied = Predetermined Overhead Rate * Actual Direct Labor Hours
    = $15.44 * 400

                              =$6,176

Answer to Part 3.

Predetermined Overhead Rate = Estimated manufacturing overhead/Machine hours

                                                  =$3,412,240/598,639

                                                  =$5.70

Answer to Part 4.

Overhead Applied = Predetermined Overhead Rate * Actual machine Hours   

                             = $5.70 * 630

                              =$3,591

ekkarill92 answered 2 years ago
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