Acc 561 wiley plus week 4 E15-5, E16-3, E17-1
E15-5 Duggan
Company applies manufacturing overhead to jobs on the basis of machine hours
used. Overhead costs are expected to total $353,920 for the year, and machine
usage is estimated at 126,400 hours. For the year, $368,283 of overhead costs
are incurred and 130,100 hours are used.
(a) Compute
the manufacturing overhead rate for the year. (Round answers to 2 decimal places, e.g 1.25.)
Manufacturing
overhead rate$_________per machine hour
(b) What
is the amount of under or over-applied overhead at December 31?
(c)
Prepare the adjusting entry to assign the under or over-applied overhead for
the year to cost of goods sold.
E16-3 The
ledger of Custer Company has the following work in process account.
Work in Process—Painting
|
5/1 Balance 4,170
5/31 Materials 7,190
5/31 Labor 3,510
5/31 Overhead 2,210
|
5/31 Transferred out ?
|
|
5/31 Balance ?
|
Production
records show that there were 500 units in the beginning inventory, 30%
complete, 1,460 units started, and 1,450 units transferred out. The beginning
work in process had materials cost of $2,480 and conversion costs of $1,690.
The units in ending inventory were 40% complete. Materials are entered at the
beginning of the painting process.
Instructions
(a) How
many units are in process at May 31?
(b) What
is the unit materials cost for May?
(c) What
is the unit conversion cost for May?
(b)&
(c)
(d) What
is the total cost of units transferred out in May?
(e) What
is the cost of the May 31 inventory?
E17-1
Wilkins Inc. has two types of handbags: standard and custom. The controller has
decided to use a plantwide overhead rate based on direct labor costs. The
president has heard of activity-based costing and wants to see how the results
would differ if this system were used. Two activity cost pools were developed:
machining and machine setup. Presented below is information related to the company’s
operations.
Standard Custom
Direct
labor costs $43,700 $102,000
Machine
hours
1,500 1,380
Setup
hours 96 440
Total
estimated overhead costs are $298,400. Overhead cost allocated to the machining
activity cost pool is $195,100, and $103,300 is allocated to the machine setup
activity cost pool. Instructions
(a)
Compute the overhead rate using the traditional (plant-wide) approach.
(b)
Compute the overhead rates using the activity-based costing approach.
(c)
Determine the difference in allocation between the two approaches.
TUTORIAL PREVIEW
(a) Compute
the manufacturing overhead rate for the year. (Round answers to 2 decimal places, e.g. 1.25.)
Manufacturing overhead rate$_________per machine hour
Manufacturing overhead rate$_________per machine hour
Expected
overhead costs = $353,920
Machine
hours = 126,400 hrs.
Manufacturing
overhead rate = 353,920/ 126,400
=
$2.80 per machine hour
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