Lupo Corporation uses a job-order costing system with a single
plantwide predetermined overhead rate based on machine-hours. The
company based its predetermined overhead rate for the current year
on the following data:
Total machine-hours 30,500
Total fixed manufacturing overhead cost $
610,000
Variable manufacturing overhead per machine-hour
$ 6.00
Recently, Job T687 was completed with the following
characteristics:
Number of units in the job 10
Total machine-hours 30
Direct materials $ 690
Direct labor cost $ 1,370
The unit product cost for Job T687 is closest to:
Multiple Choice
$147.00
$94.67
$206.00
$284.00
Gilchrist Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. At the beginning of the most recently completed year, the Corporation estimated the machine-hours for the upcoming year at 35,900 machine-hours. The estimated variable manufacturing overhead was $4.80 per machine-hour and the estimated total fixed manufacturing overhead was $945,606. The predetermined overhead rate for the recently completed year was closest to:
Multiple Choice
$31.14 per machine-hour
$30.14 per machine-hour
$4.80 per machine-hour
$26.34 per machine-hour
During March, Zea Inc. transferred $58,000 from Work in Process
to Finished Goods and recorded a Cost of Goods Sold of $64,000. The
journal entries to record these transactions would include a:
Multiple Choice
credit to Cost of Goods Sold of $64,000.
debit to Finished Goods of $64,000.
credit to Work in Process of $58,000.
credit to Finished Goods of $58,000.
Baka Corporation applies manufacturing overhead on the basis of
direct labor-hours. At the beginning of the most recent year, the
company based its predetermined overhead rate on total estimated
overhead of $240,600 and 5,600 estimated direct labor-hours. Actual
manufacturing overhead for the year amounted to $242,600 and actual
direct labor-hours were 4,900.
The overhead for the year was: (Round your intermediate
calculations to 2 decimal places.)
Multiple Choice
$30,096 underapplied
$32,096 underapplied
$30,096 overapplied
$32,096 overapplied
1) Calculate unit product cost
Direct material | 690 |
Direct labor | 1370 |
Overhead (610000/30500+6)*30 | 780 |
Total Cost | 2840 |
Unit | 10 |
Unit product cost | 284 |
So answer is d) $284
2) Predetermine overhead rate = (945606/35900+4.8) = 31.14 per MH
So answer is a) $31.14 per machine-hour
3) Journal entry
No | General Journal | Debit | Credit |
1 | Finished goods | 58000 | |
Work in process | 58000 | ||
2 | Cost of goods sold | 64000 | |
Finished goods | 64000 | ||
So answer is c) credit to Work in Process of $58,000
4) Overhead applied = 240600/5600*4900 = 210504
Actual overhead = 242600
Under applied overhead = 210504-242600 = 32096
So answer is b) $32,096 underapplied
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