Actual costing direct costs direct materials direct

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Actual costingDirect costsDirect materialsDirect laborIndirect costsAssembly support ($42900; $421,010)Total costs$106,45036,276142,72637,800$180,526$127,60441,410169,01442,420$211,434
4-64-194-194-19(10 min.)BudgetedBudgetedBudgetedmanufacturingmanufacturingmanufacturingoverheadoverheadoverheadrate,rate,rate,allocatedallocatedallocatedmanufacturingmanufacturingmanufacturingoverhead.overhead.overhead.1.Budgeted manufacturing overhead rate=Budgeted manufacturing overheadBudgeted machine hours== $20 per machine-hour$4,000,000200,000 machine-hours2. Manufacturing overhead allocated = Actual machine-hours ?Budgeted manufacturing overhead rate = 195,000 × $20 = $3,900,0003.Since manufacturing overhead allocated is greater than the actual manufacturing overheadcosts, Waheed overallocated manufacturing overhead:Manufacturing overhead allocated$3,900,000Actual manufacturing overhead costs3,860,000Overallocated manufacturing overhead$40,000
4-74-204-204-20(20-30 min.)JobJobJobcosting,costing,costing,accountingaccountingaccountingforforformanufacturingmanufacturingmanufacturingoverhead,overhead,overhead,budgetedbudgetedbudgetedrates.rates.rates.1.An overview of the product costing system isCOST OBJECT:PRODUCTCOSTALLOCATIONBASEDIRECTCOSTMachining DepartmentManufacturing OverheadMachine-HoursDirectMaterialsINDIRECTCOSTPOOLDirectManufacturingLaborIndirect CostsDirect CostsAssembly DepartmentManufacturing OverheadDirect Manuf.Labor CostBudgeted manufacturing overhead divided by allocation base:Machining overhead= $36 per machine-hour000,50000,800,1$Assembly overhead:= 180% of direct manuf. labor costs000,000,2$000,600,3$2.Machining department, 2,000 hours$36$72,000Assembly department, 180%$15,00027,000Total manufacturing overhead allocated to Job 494$99,0003.MachiningMachiningMachiningAssemblyAssemblyAssemblyActual manufacturing overhead$2,100,000$ 3,700,000Manufacturing overhead allocated,55,000$361,980,000180%$2,200,0003,960,000Underallocated (Overallocated)$120,000$ (260,000)
4-84-214-214-21(2025 min.)JobJobJobcosting,costing,costing,consultingconsultingconsultingfirm.firm.firm.1.Budgeted indirect-cost rate = $13,000,000 ÷ $5,000,000 = 260% of professional labor costs2.At the budgeted revenues of $20,000,000, Taylor’s operating income of $2,000,000equals 10% of revenues.Markup rate = $20,000,000 ÷ $5,000,000 = 400% of direct professional labor costsCOSTALLOCATIONBASEConsultingSupportConsultingSupportCOST OBJECT:JOB FORCONSULTINGCLIENTDIRECTCOSTSIndirect CostsDirect CostsINDIRECTCOSTPOOLProfessionalLabor CostsProfessionalLabor CostsProfessionalLaborClientSupport
4-93.Budgeted costsDirect costs:Director, $2003$600Partner, $100161,600Associate, $50402,000Assistant, $301604,800$ 9,000Indirect costs:Consulting support, 260%$9,00023,400Total costs$32,400As calculated in requirement 2, the bid price to earn a 10% income-to-revenue margin is 400%of direct professional costs. Therefore, Taylor should bid 4$9,000 = $36,000 for the RedRooster job.Bid price to earn target operating income-to-revenue margin of 10% can also becalculated as follows:Let R = revenue to earn target incomeR – 0.10R = $32,4000.90R = $32,400R = $32,400 ÷ 0.90 = $36,000or,Direct costs$ 9,000Indirect costs23,400Operating income3,600Bid price$36,000
4-104-224-224-22(15–20 min.)ServiceServiceServiceindustry,industry,industry,timetimetimeperiodperiodperiodusedusedusedtototocomputecomputecomputeindirectindirectindirectcostcostcostrates.rates.rates.1.(a)The full cost of Job 332, using the budgeted overhead rate of 165% for January–March, is$25,900.(b)

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