Question

In: Accounting

A small business ﬁrm. produces raincoats and overeoats for commercial sale and for the Government. Most...

A small business ﬁrm. produces raincoats and overeoats for commercial sale and for the Government. Most items are manufactured for specific customer orders. At the beginning of the year. the comptroller estimated costs and production hours for operations throughout the year. Note that Department A is more labor intensive and Department B is more automated:

	Dept A	Dept B	Total
Direct Material Cost	338000	23500	361500
Direct Labor Cost	318000	110000	428000
Department Overhead Cost	276000	480000	756000
Direct Labor Hours	30000	10000	40000
Machine Hours	2000	40000	42000

During the year, Job #l23, a ﬁrm ﬁxed—price Government contract for production of 3.000 raincoats, will be started and completed. Estimate contract cost using the rates determined in Question 1 and the following information. Use the Job Cost Summary table for your calculations. Note Department A‘s overhead rate was calculated by using direct labor hours as the base and Department B utilized machine hours.

I Materials cost totaled $3,200 for Department A and $3740 for Department B.

I Direct labor hours totaled 240 for Department A and 80 for Department B.

I Machine hours totaled 120 for Department A and 300 for Depamnent B

Find total cost for Department A and B, show all work

2) At the end of the year, the Comptroller accumulated the total actual costs and hours incurred by Department A and Department B during the year for the company. Using the information provided below, calculate the ﬁnal overhead rates for both departments.

	Dept A	Dept B	Total
Direct Material Cost	337000	25000	362000
Direct Labor Cost	360400	99000	459400
Department Overhead Cost	299000	495000	794000
Direct Labor Hours	34000	9000	43000
Machine Hours	1000	41000	42000

Department A _ direct labor hour?

Department B _ machine per hour ?

3 Why are the rates that you developed in Question 2 different than the rates developed in Question 1?

4. Given the actual costs stated above in 2, what would be the ﬁnal cost of Job #123 using the overhead rates determined in Question 1'

Expert Solution

Solution of 2) Question

ekkarill92 answered 2 years ago

EBP Limited is a small firm involved in the production and sale of electronic business products....

EBP Limited is a small firm involved in the production and sale of electronic business products. The company is well known for its attention to quality and innovation. During the past 15 months, a new product has been under development that allows users handheld access to email and video images. EBP has been designing two models: Standard and Enhanced. Development costs have amounted to RM181,500 and RM262,500 respectively. The total market demand for each model is expected to be 40,000...

3. [Price Discrimination Application] You are the marketing manager of a ﬁrm that produces carbon ﬁber...

3. [Price Discrimination Application] You are the marketing manager of a ﬁrm that produces carbon ﬁber and sells this composite material to two distinct kinds of customers: satellite producers and bicycle manufacturers. Demand for carbon ﬁber by these two market segments is quite diﬀerent, as described by the respective price equations: PS = 10−QS/600 and PB = 12−QB/100, where annual quantities [QS and QB] are in thousands of pounds and prices [PS and PB] are in dollars. Your ﬁrm estimates...

13. Assume you are a credit manager in charge of approving commercial loans to small business...

13. Assume you are a credit manager in charge of approving commercial loans to small business firms. Since the financial crisis, your boss wants to ensure that you make sound lending decisions. Identify the main aspects of the firm you will review and explain the type of information you hope to gain from reviewing each of those aspects. How would you determine whether a firm is financially healthy or not?

Business Ethics Jason Trevor owns a commercial bakery in Georgia that produces a variety of goods...

Business Ethics Jason Trevor owns a commercial bakery in Georgia that produces a variety of goods sold in grocery stores. Trevor is required by law to perform internal tests on food produced at his plant to check for contamination. On three occasions, the tests of food products containing peanut butter were positive for salmonella contamination. Trevor was not required to report the results to US Food and Drug Administration officials, however, so he did not. Instead, Trevor instructed his employees...

41. Sperazza Corporation produces large commercial doors for warehouses and other facilities. In the most recent...

41. Sperazza Corporation produces large commercial doors for warehouses and other facilities. In the most recent month, the company budgeted production of 5,700 doors. Actual production was 6,100 doors. According to standards, each door requires 5.4 machine-hours. The actual machine-hours for the month were 33,790 machine-hours. The standard supplies cost is $1.70 per machine-hour. The actual supplies cost for the month was $52,712. Supplies cost is an element of variable manufacturing overhead. The variable overhead efficiency variance for supplies cost...

Sperazza Corporation produces large commercial doors for warehouses and other facilities. In the most recent month,...

Sperazza Corporation produces large commercial doors for warehouses and other facilities. In the most recent month, the company budgeted production of 5,100 doors. Actual production was 5,500 doors. According to standards, each door requires 4.2 machine-hours. The actual machine-hours for the month were 23,540 machine-hours. The standard supplies cost is $1.10 per machine-hour. The actual supplies cost for the month was $24,011. Supplies cost is an element of variable manufacturing overhead. The variable overhead efficiency variance for supplies cost is:...

Offer some advantages that finance companies offer over commercial banks to small business customers

Because of the unique characteristics of small business, the AICPA recommends that the most efficient and...

Because of the unique characteristics of small business, the AICPA recommends that the most efficient and effective audit strategy for small business clients is to assess control risk at the maximum level and take primarily a substantive approach to the audit engagement. Do you agree? How does this approach affect the audit?

3.32. Quality Control. An automatic machine in a small factory produces metal parts. Most of the...

3.32. Quality Control. An automatic machine in a small factory produces metal parts. Most of the time (90% according to long-term records), it produces 95% good parts, while the remaining parts have to be scrapped. Other times, the machine slips into a less productive mode and only produces 70% good parts. The foreman observes the quality of parts that are produced by the machine and wants to stop and adjust the machine when she believes that the machine is not...

Your Task You will engage in a negotiation for the sale and purchase of a commercial...

Your Task You will engage in a negotiation for the sale and purchase of a commercial asset such as a business or a piece of real estate. Assessment Description You may be nominated to represent the vendor and will receive email instructions from the vendor company CEO including: 1. Appointment to represent the company as their agent for the sale of the commercial asset; 2. Specific details about the commercial asset; 3. Information about the status of current negotiations with...