Question

In: Accounting

Assume that manufacturing overhead for Glassman Company consisted of the following activities and costs: Setup (1,000...

Assume that manufacturing overhead for Glassman Company consisted of the following activities and costs:

Setup (1,000 setup hours) $ 146,000
Production scheduling (400 batches) 60,000
Production engineering (60 change orders) 90,000
Supervision (2,000 direct labor hours) 56,000
Machine maintenance (12,000 machine hours) 96,000
Total activity costs $ 448,000


The following additional data were provided for Job 845:

Direct material costs $ 8,000
Direct labor cost (5 Milling direct labor hours; 35 Finishing direct labor hours) $ 1,000
Setup hours 5 hours
Production scheduling 1 batch
Machine hours used (25 Milling machine hours;5 Finishing machine hours) 30 hours
Production engineering 3 change orders


(a) Calculate the cost per unit of activity driver for each activity cost category.

Setup Answer
Production scheduling Answer
Production engineering Answer
Supervision Answer
Machine operating Answer


(b) Calculate the cost of Job 845 using ABC to assign the overhead costs.
$Answer

(c) Calculate the cost of Job 845 using the plantwide overhead rate based on machine hours. (Round your answer to the nearest dollar.)
$Answer

(d) Calculate the cost of Job 845 using a machine hour departmental overhead rate for the Milling Department ($28 per hour) and a direct hour overhead rate for the Finishing Department ($100 per hour). (Round your answer to the nearest dollar.)
$Answer

Solutions

Expert Solution

Answer to Question a:

Answer to Question b:

Activity Cost = Activity Rate X Activity Consumed

Answer to Question c and d:

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Assume that manufacturing overhead for Windsor Company consisted of the following activities and costs: Setup (1,000...
Assume that manufacturing overhead for Windsor Company consisted of the following activities and costs: Setup (1,000 setup hours) $ 92,000 Production scheduling (300 batches) 24,000 Production engineering (70 change orders) 70,000 Supervision (2,200 direct labor hours) 66,000 Machine maintenance (13,000 machine hours) 78,000 Total activity costs $ 330,000 The following additional data were provided for Job 845: Direct material costs $ 6,000 Direct labor cost (5 Milling direct labor hours; 25 Finishing direct labor hours) $ 1,000 Setup hours 5...
Assume that manufacturing overhead for Goldratt Company consisted of the following activities and costs: Setup (1,000...
Assume that manufacturing overhead for Goldratt Company consisted of the following activities and costs: Setup (1,000 setup hours) $168,000 Production scheduling (400 batches) 50,000 Production engineering (60 change orders) 150,000 Supervision (2,000 direct labor hours) 64,000 Machine maintenance (12,000 machine hours) 108,000 Total activity costs $540,000 The following additional data were provided for Job 845: Direct materials costs $7,000 Direct labor cost (5 Milling direct labor hours;35 Finishing direct labor hours) $1,000 Setup hours 5 hours Production scheduling 1 batch...
Calculating Activity-Based Costing Overhead Rates Assume that manufacturing overhead for Goldratt Company consisted of the following...
Calculating Activity-Based Costing Overhead Rates Assume that manufacturing overhead for Goldratt Company consisted of the following activities and costs: Setup (1,000 setup hours) $118,000 Production scheduling (400 batches) 30,000 Production engineering (60 change orders) 90,000 Supervision (2,000 direct labor hours) 64,000 Machine maintenance (12,000 machine hours) 84,000 Total activity costs $386,000 The following additional data were provided for Job 845: Direct materials costs $7,000 Direct labor cost (5 Milling direct labor hours;35 Finishing direct labor hours) $1,000 Setup hours 5...
Calculating Activity-Based Costing Overhead Rates Assume that manufacturing overhead for Goldratt Company consisted of the following...
Calculating Activity-Based Costing Overhead Rates Assume that manufacturing overhead for Goldratt Company consisted of the following activities and costs: Setup (1,000 setup hours) $150,000 Production scheduling (400 batches) 80,000 Production engineering (60 change orders) 60,000 Supervision (2,000 direct labor hours) 66,000 Machine maintenance (12,000 machine hours) 48,000 Total activity costs $404,000 The following additional data were provided for Job 845: Direct materials costs $7,000 Direct labor cost (5 Milling direct labor hours;35 Finishing direct labor hours) $1,000 Setup hours 5...
Calculating Activity-Based Costing Overhead Rates Assume that manufacturing overhead for Goldratt Company consisted of the following...
Calculating Activity-Based Costing Overhead Rates Assume that manufacturing overhead for Goldratt Company consisted of the following activities and costs: Setup (1,000 setup hours) $150,000 Production scheduling (400 batches) 80,000 Production engineering (60 change orders) 60,000 Supervision (2,000 direct labor hours) 66,000 Machine maintenance (12,000 machine hours) 48,000 Total activity costs $404,000 The following additional data were provided for Job 845: Direct materials costs $7,000 Direct labor cost (5 Milling direct labor hours;35 Finishing direct labor hours) $1,000 Setup hours 5...
Assume a product has the following activities and overhead costs: Production ($40 per labor hour) Assembly...
Assume a product has the following activities and overhead costs: Production ($40 per labor hour) Assembly ($25 per labor hour) Quality Inspection ($100 per inspection) Also assume that each product requires 5 hours of direct labor hours for production, 4 hours of direct labor hours for assembly, and one inspection for every 10 units produced. If the company produces 100 units, what is the total overhead cost?
Multiple Versus Single Overhead Rates, Activity Drivers Deoro Company has identified the following overhead activities, costs,...
Multiple Versus Single Overhead Rates, Activity Drivers Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity Setting up equipment $466,260 Number of setups 570 Ordering costs 369,600 Number of orders 17,600 Machine costs 702,100 Machine hours 41,300 Receiving 414,000 Receiving hours 9,200 Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Model A Model B Direct materials $574,000 $790,000 Direct...
DAB Company has identified the following overhead activities, costs, and activity drivers for the coming year:...
DAB Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity                                Expected Cost          Activity Driver               Activity Capacity Material-handling costs.. £45,000             Number of moves.........        450 Machine costs................ £80,000             Machine hours.............. 20,000 Order costs.................... £15,000             Number of orders.........        750 Receiving costs.............. £30,000             Number of parts........... 50,000 Setup costs.................... £50,000             Number of setups.........        250 Assume that each activity corresponds to a process. DAB’s normal activity is 5,000 direct labor hours. The following two jobs...
What overhead activities are present in a homeless shelter? List two. Remember: overhead costs (and activities)...
What overhead activities are present in a homeless shelter? List two. Remember: overhead costs (and activities) are those costs directly related to producing products or providing services that are not direct labor or indirect materials.
The following cost functions were developed for manufacturing overhead costs: Manufacturing Overhead Cost Cost Function Electricity...
The following cost functions were developed for manufacturing overhead costs: Manufacturing Overhead Cost Cost Function Electricity $200 + $20 per direct labor hour Maintenance $400 + $30 per direct labor hour Supervisors' salaries $20,000 per month Indirect materials $16 per direct labor hour If June production is expected to be 2,000 units requiring 3,000 direct labor hours, what is the estimated manufacturing overhead costs? Also discuss the role of direct labor hours in determining the predetermined overhead rates.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT