Ayayai Company manufactures tablecloths. Sales have grown rapidly over the past 2 years. As a result, the president has installed budgetary control system for 2022. The following data were used in developing the master manufacturing overhead budget for th Ironing Department, which is based on an activity index of direct labor hours. Variable costs Indirect labor Indirect materials Factory utilities Factory repairs Rate per Direct Labor Hour $0.40 0.50 0.30 0.20 Annual Fixed Costs Supervision Depreciation Insurance Rent $40,800 14,400 12,000 22,800 The master overhead budget was prepared in the expectation that 475,000 direct labor hours will be worked during the year. In June, 37,000 direct labor hours were worked. At that level of activity, actual costs were as shown below. Variable-per direct labor hour: indirect labor $0.42, indirect materials $0.49, factory utilities $0.32, and factory repairs $0.24. Fixed: same as budgeted.

Ayayai Company manufactures tablecloths. Sales have grown rapidly over the past 2 years. As a result, the president has installed budgetary control system for 2022. The following data were used in developing the master manufacturing overhead budget for th Ironing Department, which is based on an activity index of direct labor hours. Variable costs Indirect labor Indirect materials Factory utilities Factory repairs Rate per Direct Labor Hour $0.40 0.50 0.30 0.20 Annual Fixed Costs Supervision Depreciation Insurance Rent $40,800 14,400 12,000 22,800 The master overhead budget was prepared in the expectation that 475,000 direct labor hours will be worked during the year. In June, 37,000 direct labor hours were worked. At that level of activity, actual costs were as shown below. Variable-per direct labor hour: indirect labor $0.42, indirect materials $0.49, factory utilities $0.32, and factory repairs $0.24. Fixed: same as budgeted.

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Description: Please do not give solution in image format thanku Ayayai Company manufactures tablecloths. Sales have grown rapidly over the past 2 years. As a result, the president has installed abudgetary control system for 2022. The following data were used in d

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter5: Product And Service Costing: Job-order System

Section: Chapter Questions

Problem 27P: Firenza Company manufactures specialty tools to customer order. Budgeted overhead for the coming...

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Firenza Company manufactures specialty tools to customer order. Budgeted overhead for the coming year is: Previously, Sanjay Bhatt, Firenza Companys controller, had applied overhead on the basis of machine hours. Expected machine hours for the coming year are 50,000. Sanjay has been reading about activity-based costing, and he wonders whether or not it might offer some advantages to his company. He decided that appropriate drivers for overhead activities are purchase orders for purchasing, number of setups for setup cost, engineering hours for engineering cost, and machine hours for other. Budgeted amounts for these drivers are 5,000 purchase orders, 500 setups, and 2,500 engineering hours. Sanjay has been asked to prepare bids for two jobs with the following information: The typical bid price includes a 40 percent markup over full manufacturing cost. Required: 1. Calculate a plantwide rate for Firenza Company based on machine hours. What is the bid price of each job using this rate? 2. Calculate activity rates for the four overhead activities. What is the bid price of each job using these rates? 3. Which bids are more accurate? Why?
Magnify Corporation manufactures and sells two types of decorative lamps, Knox and Ayer. The following data are available the year 2020. Machine setup-hours is the only driver of manufacturing overhead costs. Magnify has a set up capacity of 1,0 hours. (Click the icon to view the information.) Calculate the manufacturing overhead costs budget (label it Schedule 5). Schedule 5: Manufacturing Overhead Costs Budget for the Year Ending December 31, 2020 Machine Setup Overhead Costs Total manufacturing overhead costs Data table 1. Quantity of lamps to be produced 2. Number of lamps to be produced per batch 3. Setup time per batch Variable cost = $65per setup-hour Fixed cost $78,000 = Print Knox 21,000 lamps 50 lamps/batch 2 hours/batch Done Ayer 15,000 lamps 200 lamps/batch 3 hours/batch X
Check n Tioga Company manufactures sophisticated lenses and mirrors used in large optical telescopes. The company is now preparing its annual profit plan. As part of its analysis of the profitability of individual products, the controller estimates the amount of overhead that should be allocated to the individual product lines from the following information. Lenses Mirrors Units produced Material moves per product line Direct-labor hours per unit 23 23 17 160 160 The total budgeted material-handling cost is $70,840. Required: 1. Under a costing system that allocates overhead on the basis of direct-labor hours, the material-handling costs allocated to one lens would be what amount? 2. Under a costing system that allocates overhead on the basis of direct-labor hours, the material-handling costs allocated to one mirror would be what amount? 3. Under activity-based costing (ABC), the material-handling costs allocated to one lens would be what amount? The cost driver for the…
Light Up Corporation manufactures and sells two types of decorative lamps, Knox and Ayer. The following data are available for the year 2020. Machine setup-hours is the only driver of manufacturing overhead costs. Light Up has a set up capacity of 960 hours. (Click the icon to view the information.) Calculate the manufacturing overhead costs budget (label it Schedule 5). Schedule 5: Manufacturing Overhead Costs Budget for the Year Ending December 31, 2020 Machine Setup Overhead Costs Total manufacturing overhead costs
Sparkle Corporation manufactures and sells two types of decorative lamps, Knox and Ayer. The following data are available for the year 2020. Machine setup-hours is the only driver of manufacturing overhead costs. Sparkle has a set up capacity of 2,220 hours. (Click the icon to view the information.) Calculate the manufacturing overhead costs budget (label it Schedule 5). Schedule 5: Manufacturing Overhead Costs Budget for the Year Ending December 31, 2020 Machine Setup Overhead Costs Total manufacturing overhead costs Data table 1. Quantity of lamps to be produced 2. Number of lamps to be produced per batch 3. Setup time per batch Variable cost = $70 per setup-hour Fixed cost = - $79,000 Knox 21,000 lamps 50 lamps/batch 3 hours/batch Ayer 12,000 lamps 50 lamps/batch 4 hours/batch X
Fulcrum Industries manufactures dining chairs and tables. The following information is available in December 2020: Dining Chairs Tables Total CostMachine setups 200 600 $48,000Inspections 250 470 $72,000Labor hours 2,600 2,400 Fulcrum is considering switching from one overhead rate based on labor hours to activity-based costing.InstructionsPerform the following analyses for these two components of overhead:a. Compute total machine setups and inspection costs assigned to each product, using a single overhead rate.b. Compute total machine setups and inspection costs assigned to each product, using activity-based costing.c. Comment on your findings.
JYD Corporation has two departments, Assembly and Finishing. The following are data available for two departments in 2021: Assembly Finishing Machine hours per unit 10 hours 5 hours Direct labor hours 2 hours 1 hour Budgeted (Estimated) Factory Overhead $325,000 $175,000 Budgeted machine hours 15,000 hours 2,500 hours Budgeted direct labor hours 3,000 hours 2,000 hours Questions: 1. Using plant-wide Factory Overhead rate based on direct labor hours, how much is the Factory Overhead rate per unit? 2. Assume in the Assembly Department, machine hours are the basis in calculation the Factory overhead rate, what is the departmental Factory overhead rate per unit? 3. Assume in the Finishing Department, direct labor hours are the basis in calculation the Factory overhead rate, what is the departmental Factory overhead rate per unit?
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Palladium Inc. produces a variety of household cleaning products. Palladium's controller has developed standard costs for the following four overhead items: Overhead Item Total Fixed Cost Variable Rate per Direct Labor Hour Maintenance $86,000 $0.20 Power $0.45 Indirect Labor $140,000 $2.10 Rent $35,000 Next year, Palladium expects production to require 88,000 direct labor hours. Prepare an overhead budget for the expected level of direct labor hours for the coming year.
Palladium Inc. produces a variety of household cleaning products. Palladium’s controller has developed standard costs for the following four overhead items: Overhead Item Total Fixed Cost Variable Rate per DirectLabor Hour Maintenance $ 86,000 $0.20 Power 0.45 Indirect labor 140,000 2.10 Rent 35,000 Next year, Palladium expects production to require 90,000 direct labor hours. Required: 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. Palladium Inc. Overhead Budget For the Coming Year Variable costs: Rate per Hour Activity Level 90,000 Hours Maintenance $ $ Power Indirect labor Total variable cost $ Fixed costs: Maintenance $ Indirect labor Rent Total fixed costs $ Total overhead costs $ 2. Prepare an overhead budget that reflects…
I NEED HELP WITH REQUIREMENT 2: Mariposa, Inc., produces machine tools and currently uses a plantwide overhead rate, based on machine hours. Harry Whipple, the plant manager, has heard that departmental overhead rates can offer significantly better cost assignments than can a plantwide rate. Mariposa has the following data for its two departments for the coming year: Department A Department B Overhead costs (expected) $528,000 $132,000 Normal activity (machine hours) 110,000 55,000 Required: 1. Compute a predetermined overhead rate for the plant as a whole based on machine hours.$fill in the blank 1 per machine hour 4 2. Compute predetermined overhead rates for each department using machine hours. Round your answers to one decimal place. Department A 4.8 Department B 2.4 3. Suppose that a machine tool (Product X75) used 60 machine hours from Department A and 140 machine hours from Department B. A second machine tool (Product Y15) used 140 machine hours from…
Tioga company manufactures sophisticated lenses and mirrors used in large optical telescopes. The company is now preparing its annual profit plan. As part of its analysis of the profitability of individual products, the controller estimates the amount of overhead that should be allocated to the individual product lines from the following information. Lenses Mirrors Units produced Material moves per product line 5 Direct-labor hours per unit The total budgeted material-handling cost is 50,000 Required: 1. Under a costing system that allocates overhead on the basis of direct-labor hours, the material-handling costs allocated to one lens would be what amount? 2. Answer the same question as in requirement 1), but for mirrors 3. Under activity-based costing(ABC), the material-handling costs allocated to one lens would be what amount? The cost driver for the material-handling activity is the number of material moves 4. Answer the same question as in requirement 3, but for mirrors. 25 25 15…