In: Accounting
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Calculation Of Predetermined Overhead rate: | |||||||
Predtermined Overhead = | Total Estiamted Manufacturing Overhead | "/" By | Total Estimated Direct Lab. Hours | ||||
Predtermined Overhead = | $ 392,000 | "/" By | 4,000 | ||||
Predtermined Overhead = | $ 98.00 | Per Hours | |||||
Solution: 1 | |||||||
CALCULATION OF OVERHEAD ASSIGNED TO EACH PRODUCT USING TRADITTIONAL COSTING | |||||||
Particulars | MB -R OH | MB -X OH | |||||
No. of Direct Lab. Hrs | 1,500 | 2,500 | |||||
"X" Lab. Ovh Rate | $ 98.00 | $ 98.00 | |||||
Total Overhead | $ 147,000 | $ 245,000 | |||||
Solution: 2 | |||||||
Calculation of the Cost Driver Rate | |||||||
Cost Driver Rate = Activity Cost / Cost Driver | |||||||
Activity | Cost Driver | Activity Cost | "/" By | Cost Driver | " = " To | Cost Driver Rate | |
Testing and Inspection | No. of Testing and Inspection | $ 108,000 | "/" By | 720 | " = " To | $ 150.00 | |
Machine Setup | No. of Set-ups | $ 72,000 | "/" By | 200 | " = " To | $ 360.00 | |
Machine Stamping | No. of Machine Hours | $ 160,000 | "/" By | 32,000 | " = " To | $ 5.00 | |
Plant Maintenance | No. of Labor Hours | $ 52,000 | "/" By | 4,000 | " = " To | $ 13.00 | |
Total | $ 392,000 | ||||||
CALCULATION OF OVERHEAD ASSIGNED TO PRODUCT MB-R | |||||||
Activity | Activity Used | "X " By | Cost Driver rate | Cost | |||
Testing and Inspection | 360 | "X " By | $ 150 | $ 54,000 | |||
Machine Setup | 120 | "X " By | $ 360 | $ 43,200 | |||
Machine Stamping | 21,000 | "X " By | $ 5 | $ 105,000 | |||
Plant Maintenance | 1,500 | "X " By | $ 13 | $ 19,500 | |||
Total Cost | $ 221,700 | ||||||
CALCULATION OF OVERHEAD ASSIGNED TO PRODUCT MB-X | |||||||
Activity | Activity Used | "X " By | Cost Driver rate | Cost | |||
Testing and Inspection | 360 | "X " By | $ 150.00 | $ 54,000 | |||
Machine Setup | 80 | "X " By | $ 360.00 | $ 28,800 | |||
Machine Stamping | 11,000 | "X " By | $ 5.00 | $ 55,000 | |||
Plant Maintenance | 2,500 | "X " By | $ 13.00 | $ 32,500 | |||
Total Cost | $ 170,300 | ||||||
Solution: 3 | |||||||
Overhead Assigned to Prodcut as below, | |||||||
Product MB-R | Product MB-X | ||||||
As per Tradittional Costing |
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(Click the icon to view the cost data.)Read the
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LOADING...
.
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manufacturing overhead rate.
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rate, then compute the rate.
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/
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=
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