Ch5 solutions

Ch5 solutions - 4-20Job costing accounting for...

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Unformatted text preview: 4-20Job costing, accounting for manufacturing overhead, budgeted rates.1.An overview of the product costing system isCOST OBJECT:PRODUCTCOSTALLOCATIONBASEDIRECTCOST}}Machining DepartmentManufacturing OverheadMachine-HoursDirectMaterialsINDIRECTCOSTPOOL}DirectManufacturingLaborIndirect CostsDirect Costs}Assembly DepartmentManufacturing OverheadDirect Manuf.Labor CostBudgeted manufacturing overhead divided by allocation base:Machining overhead000,50000,800,1$= $36 per machine-hourAssembly overhead:000,000,2$000,600,3$= 180% of direct manuf. labor costs2.Machining department, 2,000 hours ×$36$72,000Assembly department, 180% ×$15,00027,000Total manufacturing overhead allocated to Job 494$99,0003.MachiningAssemblyActual manufacturing overhead$2,100,000$ 3,700,000Manufacturing overhead allocated,55,000 ×$361,980,000— 180% ×$2,200,000— 3,960,000Underallocated (Overallocated)$ 120,000$ (260,000)5-19Plantwide, department and ABC indirect cost rates. 1.Actual plant-wide variable MOH rate based on machine hours, $308,600÷4,000 $77.15 per machine hourUnited MotorsHolden MotorsLeland VehicleTotalVariable manufacturing overhead, allocated based on machine hours ($77.15 ×120; $77.15 ×2,800; $77.15 ×1,080)$9,258$216,02$83,322$308,6002. DepartmentVariable MOH in 2007Total Driver UnitsRateDesign$39,000390$100per CAD-design hour Production29,600370$ 80per engineering hour Engineering240,0004,000$ 60per machine hourUnited MotorsHoldenMotorsLeland VehicleTotalDesign-related overhead, allocated on CAD-design hours (110 ×$100; 200 ×$100; 80 ×$100)$11,000 $ 20,000 $ 8,000 $ 39,000 Production-related overhead, allocated on engineering hours (70 ×$80; 60 ×$80; 240 ×$80)5,600 4,800 19,200 29,600 Engineering-related overhead, allocated on machine hours (120 ×$60; 2,800 ×$60; 1,080 ×$60)7,200168,00064,800 240,000Total$23,800$192,800$92,000 $308,6003.United MotorsHoldenMotorsLelandVehiclea. Department rates(Requirement 2)b. Plantwide rate(Requirement 1)$23,800$ 9,258$192,800$216,020$92,000$83,322Ratio of (a) ÷ (b)2.570.891.10The variable manufacturing overhead allocated to United Motors increases by 157% under the department rates, the overhead allocated to Holden decreases by about 11% and the overhead allocated to Leland increases by about 10%....
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This note was uploaded on 05/27/2011 for the course ACG 3361 taught by Professor Swirsky during the Spring '11 term at Florida A&M.

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Ch5 solutions - 4-20Job costing accounting for...

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