AC 54 - pool(a CompuTe The overhead raTe using The...

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Question: Exercise 17-1 Wilkins Inc. has two types of handbags: standard and custom. The controller has decided to use a plant wide overhead rate based on direct labor costs. The president has heard of activity-based costing and wants to see how the results would differ if this system were used. Two activity cost pools were developed: machining and machine setup. Presented below is information related to the company’s operations. Standard Custom Direct labor costs $53,000 $108,000 Machine hours 1,190 1,500 Setup hours 110 440 Total estimated overhead costs are $308,800. Overhead cost allocated to the machining activity cost pool is $196,400, and $112,400 is allocated to the machine setup activity cost
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Unformatted text preview: pool. (a) CompuTe The overhead raTe using The Traditonal (planT wide) approach. (Round answers To 2 decimal places, e.g. 12.25%.) PredeTermined overhead raTe % of direcT labor cosT Answer: a) Predetermined overhead rate based on direct labor costs = Overhead / Direct labor costs = $308,800 / ($53,000 + $108,000) = 191.80% of Direct labor costs. Queston: Answer: Date Inventory at base year cost Inventory layers Year of layer Inventory at added year cost Inventory (Dollar Value LIFO) 12/31/2014 $ 20,200.00 $ 19,500.00 Base layer $ 19,500.00 $ 700.00 2013 $ 735.00 $ 20,235.00 12/31/2015 $ 22,400.00 $ 19,500.00 $ 19,500.00 $ 700.00 $ 735.00 $ 2,200.00 $ 2,486.00 $ 22,721.00...
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