Question

How is manufacturing overhead calculated in each of the costing methods? How are variances identified?

How is manufacturing overhead calculated in each of the costing methods? How are variances identified?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Manufacturing overhead means the indirect expenses related to the manufacturing of a product. The cost attributable to a particular product according to the number of units manufactured is the basis on which the manufacturing overhead is calculated.

There can be variances in the budgeted manufacturing overhead and the actual manufacturing overhead. In order to calculate the variance, one needs to subtract the budgeted manufacturing overhead from the actual manufacturing overhead.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Overhead Variances, Four-Variance Analysis, Journal Entries Laughlin, Inc., uses a standard costing system. The predetermined overhead...
Overhead Variances, Four-Variance Analysis, Journal Entries Laughlin, Inc., uses a standard costing system. The predetermined overhead rates are calculated using practical capacity. Practical capacity for a year is defined as 1,000,000 units requiring 200,000 standard direct labor hours. Budgeted overhead for the year is $750,000, of which $300,000 is fixed overhead. During the year, 900,000 units were produced using 190,000 direct labor hours. Actual annual overhead costs totaled $800,000, of which $294,700 is fixed overhead. Required: 1. Calculate the fixed...
derro company has identified the following overhead activities and calculated the following application rates: Activity Cleaning...
derro company has identified the following overhead activities and calculated the following application rates: Activity Cleaning equipment $100/batch Purchasing ingredient $50/purchase Advertising $500/Advertisement Renting factory space $1000/flavor a. What level of overhead is each of these overhead activities? b. How much overhead would a new flavour receive if it were made in five batches, required 20 Purchases, and advertised twice? c. if penalty of the factory space is available for the production of more ice cream flavors, will the company...
Under variable costing, ______________ costs are considered product costs. variable manufacturing overhead fixed manufacturing overhead fixed...
Under variable costing, ______________ costs are considered product costs. variable manufacturing overhead fixed manufacturing overhead fixed selling and administrative property tax on the administrative office
4-24 Budgeted manufacturing overhead rate, allocated manufacturing overhead. Gammaro Company uses normal costing. It allocates manufacturing...
4-24 Budgeted manufacturing overhead rate, allocated manufacturing overhead. Gammaro Company uses normal costing. It allocates manufacturing overhead costs using a budgeted rate per machine-hour. The following data are available for 2017: Budgeted manufacturing overhead costs $4,600,000 Budgeted machine-hours      184,000 Actual manufacturing overhead costs $4,830,000 Actual machine-hours      180,000 Required: Calculate the budgeted manufacturing overhead rate. Calculate the manufacturing overhead allocated during 2017. Calculate the amount of under- or overallocated manufacturing overhead. Why do Gammaro’s managers need to calculate this amount?
What are budget variances, how are they calculated, and why are they important?
What are budget variances, how are they calculated, and why are they important?
1- How is calculated the estimated rate of allocation of overhead? 2- How is calculated the...
1- How is calculated the estimated rate of allocation of overhead? 2- How is calculated the actual rate of allocation of overhead?
In 200 words or more, How might each of the costing methods be used in managerial...
In 200 words or more, How might each of the costing methods be used in managerial decision-making? Original work please.
Valor company is planning to implement an activity-based costing (ABC) system to apply overhead costs to...
Valor company is planning to implement an activity-based costing (ABC) system to apply overhead costs to products. Three activities were identified and rates were calculated for each activity. Purchase requisitions: $5 per requisition processed Production setup: $20 per setup Quality control: $30 per inspection Assume 600 purchase requisitions were processed, 1,200 production setups were performed, and 300 products were inspected for the year. Which of the following journal entries would be made by Valor to record the application of overhead?...
Overhead Variances, Four-Variance Analysis Oerstman, Inc., uses a standard costing system and develops its overhead rates...
Overhead Variances, Four-Variance Analysis Oerstman, Inc., uses a standard costing system and develops its overhead rates from the current annual budget. The budget is based on an expected annual output of 125,000 units requiring 500,000 direct labor hours. (Practical capacity is 520,000 hours.) Annual budgeted overhead costs total $830,000, of which $585,000 is fixed overhead. A total of 119,100 units using 498,000 direct labor hours were produced during the year. Actual variable overhead costs for the year were $261,100, and...
Which of the following statements are true regarding Activity-Based Costing? Select one: A. Non-manufacturing costs are...
Which of the following statements are true regarding Activity-Based Costing? Select one: A. Non-manufacturing costs are not important to include when calculating the cost of each product. B. Costs are allocated based on a pre-determined overhead rate for each cost pool. C. Transitioning from traditional costing methods to Activity-Based Costing is a relatively simple process that most companies complete quickly. D. Activity-Based Costing results in a different amount of total overhead applied than under traditional costing methods. E. None of...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT