Question

iii) Brand Corporation has provided the following information: Cost per Unit Cost per Period Direct materials...

iii) Brand Corporation has provided the following information:

Cost per Unit

Cost per Period

Direct materials

$

4.90

Direct labor

$

4.00

Variable manufacturing overhead

$

1.60

Fixed manufacturing overhead

$

8,700

Sales commissions

$

2.00

Variable administrative expense

$

0.35

Fixed selling and administrative expense

$

5,700

For financial reporting purposes, the total amount of period costs incurred to sell 3,000 units is closest to:

Multiple Choice

Top of Form

$12,750

$7,050

$5,700

$8,700 Bottom of Form

Bottom of Form

iv) Brand Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. Data for the upcoming year appear below:

Estimated machine-hours

72,600

Estimated variable manufacturing overhead

$

3.10

per machine-hour

Estimated total fixed manufacturing overhead

$

838,740

The predetermined overhead rate for the recently completed year was closest to:

Multiple Choice

Top of Form

$8.66 per machine-hour

$9.30 per machine-hour

$14.65 per machine-hour

v) Job 301 was recently completed. The following data have been recorded on its job cost sheet:

Direct materials

$

2,454

Direct labor-hours

71

labor-hours

Direct labor wage rate

$

15

per labor-hour

Machine-hours

137

machine-hours

The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $16 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 301 would be:

Multiple Choice

Top of Form

$3,519

$5,711

$3,035

$6,551

vi) Brand Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on direct labor-hours. The company based its predetermined overhead rate for the current year on the following data:

Total direct labor-hours

70,000

Total fixed manufacturing overhead cost

$

273,000

Variable manufacturing overhead per direct labor-hour

$

6.00

Recently, Job P673 was completed with the following characteristics:

Number of units in the job

50

Total direct labor-hours

100

Direct materials

$

680

Direct labor cost

$

7,000

The total job cost for Job P673 is closest to: (Round your intermediate calculations to 2 decimal places.)Rechecks 2017-06-22, 2017-08-01

Multiple Choice

Top of Form

$7,990

$7,680

$1,670

$8,670

Homework Answers

Answer #1

1) Total amount of period cost :

Sales commissions (3000*2) 6000
Variable administrative expense (3000*.35) 1050
Fixed selling and administrative expense 5700
Total 12750

So answer is a) $12750

2) Predetermine overhead rate = (838740/72600)+3.10 = $14.65 per machine hour

so answer is $14.65 per machine hour

3) Total cost record in job cost sheet :

Direct material 2454
Direct labour (71*15) 1065
Applied overhead (137*16) 2192
Total 5711

So answer is $5711

4) Overhead rate = 273000/70000+6 = 9.9 per labour hour

Direct material 680
Direct labour 7000
Overhead applied (100*9.9) 990
Total 8670

So answer is $8670

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