Question

You have just taken a job at a manufacturing company and have discovered that they do...

You have just taken a job at a manufacturing company and have discovered that they do not use a predetermined overhead rate to apply overhead costs to products. They simply add actual overhead to the product costs in production as they are incurred.

Compose a short email - 5 to 7 sentences because the president it too busy to read anything longer than that - proposing a predetermined overhead rate for your company. You can use plantwide, departmental or activity based, but whatever you suggest, defend it.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Sub: suggestion regarding overhead applications.

Sir,

Since I started my job here, i saw that our company doesn't allocates its overhead properly. We didn't have a predetermined overhead allocation rate. So I suggest activity based costing in our manufacturing units. It will identify all activities of our production and assigns cost of each activity based on consumption. It will reduce the unwanted overhead expenses and take control of all activities.

Regards.

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
You have just taken a job at a manufacturing company and have discovered that they do...
You have just taken a job at a manufacturing company and have discovered that they do not use a balanced scorecard. You are doing great in your new job and all of your suggestions so far have been implemented. Compose a short email - 5 to 7 sentences because the president it too busy to read anything longer than that - proposing a balanced scorecard system for your company.
You have just taken a job at a manufacturing company and have discovered that they use...
You have just taken a job at a manufacturing company and have discovered that they use absorption costing to analyze product costs and subsequent cost-volume-profit decisions. You would like to introduce them to variable costing and explain to them why this costing method can be used and why it is helpful. Compose a short email - 2 to 3 short paragraphs because the president it too busy to read anything longer than that - proposing a variable costing system and...
“Blast it!” said David Wilson, president of Teledex Company. “We’ve just lost the bid on the...
“Blast it!” said David Wilson, president of Teledex Company. “We’ve just lost the bid on the Koopers job by $2,000. It seems we’re either too high to get the job or too low to make any money on half the jobs we bid.” Teledex Company manufactures products to customers’ specifications and uses a job-order costing system. The company uses a plantwide predetermined overhead rate based on direct labor cost to apply its manufacturing overhead (assumed to be all fixed) to...
“Blast it!” said David Wilson, president of Teledex Company. “We’ve just lost the bid on the...
“Blast it!” said David Wilson, president of Teledex Company. “We’ve just lost the bid on the Koopers job by $4,000. It seems we’re either too high to get the job or too low to make any money on half the jobs we bid.” Teledex Company manufactures products to customers’ specifications and operates a job order costing system. Manufacturing overhead cost is applied to jobs on the basis of direct labor cost. The following estimates were made at the beginning of...
“Don’t tell me we have lost another bid!” exclaimed Roha, president of Rohami Sdn Bhd. “I’m...
“Don’t tell me we have lost another bid!” exclaimed Roha, president of Rohami Sdn Bhd. “I’m afraid so,” replied Ramy, the operation vice president. “One of our competitors underbid us by about RM10,000 on the RR2 job.” “I just can’t figure it out,” said Roha. “It seems we are either too high to get the job or too low to make any money on half the jobs we bid any more. What’s happened?” Roha Sdn Bhd manufactures specialized goods to...
The following cost data relate to the manufacturing activities of Chang Company during the just completed...
The following cost data relate to the manufacturing activities of Chang Company during the just completed year:            Manufacturing overhead costs incurred:        Indirect materials $ 16,800        Indirect labor 148,000        Property taxes, factory 9,800        Utilities, factory 88,000        Depreciation, factory 295,300        Insurance, factory 11,800           Total actual manufacturing overhead costs incurred $ 569,700       Other costs incurred:        Purchases of raw materials (both direct and indirect) $ 418,000        Direct labor cost $ 78,000   Inventories:        Raw materials, beginning $ 21,800        Raw materials, ending...
Delph Company uses a job-order costing system and has two manufacturing departments—Molding and Fabrication. The company...
Delph Company uses a job-order costing system and has two manufacturing departments—Molding and Fabrication. The company provided the following estimates at the beginning of the year:    Molding Fabrication Total Machine-hours 21,000 32,000 53,000 Fixed manufacturing overhead cost $ 700,000 $ 280,000 $ 980,000 Variable manufacturing overhead cost per machine-hour $ 3.00 $ 1.00    During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs—Job D-70 and Job C-200. It...
For this assignment, you will be doing tasks related to a manufacturing company that uses job...
For this assignment, you will be doing tasks related to a manufacturing company that uses job order costing or process costing. Information for the firm is given below. Sonia Company manufactures custom-made fire trucks and had the following estimates and actual costs for 2016: Sonia Company Estimates and Actual Costs Estimate Actual Direct materials used $1,400,000 $1,500,000 Direct labor 1,000,000 1,050,000 Indirect labor 400,000 375,000 Factory insurance 25,000 25,000 Factory maintenance 100,000 50,000 Factory rent 575,000 550,000 Factory equipment depreciation...
Delph Company uses a job-order costing system and has two manufacturing departments—Molding and Fabrication. The company...
Delph Company uses a job-order costing system and has two manufacturing departments—Molding and Fabrication. The company provided the following estimates at the beginning of the year:    Molding Fabrication Total   Machine-hours 30,000 40,000     70,000   Fixed manufacturing overhead costs $ 730,000 $ 270,000     $ 1,000,000   Variable manufacturing overhead per machine-hour $ 6.00 $ 6.00        During the year, the company had no beginning or ending inventories and it started, completed, and sold only two jobs—Job D-70 and Job...
3. Bakerston Company is a manufacturing firm that uses job-order costing. The company's inventory balances were...
3. Bakerston Company is a manufacturing firm that uses job-order costing. The company's inventory balances were as follows at the beginning and end of the year: The company applies overhead to jobs using a predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that it would work 33,000 machine-hours and incur $231,000 in manufacturing overhead cost. The following transactions were recorded for the year: raw materials beginning balance $14,000 ending $22,000 WIP beginning $27,000...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT