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ACCA 310 FINAL EXAM PRACTICE PROBS WITH ANSWERS

ACCA 310 FINAL EXAM PRACTICE PROBS WITH ANSWERS - 1 The...

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1. The following information was gathered for Elliott Company: Budgeted direct-labor hours 75,000 Actual direct-labor hours 77,500 Budgeted factory overhead $562,500 Actual factory overhead $538,000 Assume that direct-labor hours is the cost driver. Compute: a. Budgeted factory-overhead rate b. Factory overhead applied c. Amount of over/underapplied overhead Answer: a. $562,500 / 75,000 hours = $7.50 per hour b. $7.50 x 77,500 hours = $581,250 c. $538,000 - $581,250 = $43,250 overapplied 2. Jones Corp. uses a budgeted factory-overhead rate to apply overhead to production. The following data are available for the year: Budgeted factory overhead $675,000 Actual factory overhead $726,000 Budgeted direct-labor costs $450,000 Actual direct-labor costs $482,000 End of year balances are as follows: Materials inventory $120,000 WIP inventory $100,000 Cost of goods sold $150,000 Finished goods inventory $250,000 Required: a. Determine the budgeted factory-overhead rate based on direct-labor costs. b. What is the applied overhead based on direct-labor costs? c. What is the overhead variance?
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