Blue Spruce Services Inc. is trying to establish the standard labour cost of a typical oil change. The following data have been collected from time and motion studies conducted over the past month: Actual time spent on the oil change 1.00 hour Hourly wage rate Payroll taxes Set-up and downtime Cleanup and rest periods Fringe benefits $12.00 10% of wage rate 20% of actual labour time 30% of actual labour time 20% of wage rate

Blue Spruce Services Inc. is trying to establish the standard labour cost of a typical oil change. The following data have been collected from time and motion studies conducted over the past month: Actual time spent on the oil change 1.00 hour Hourly wage rate Payroll taxes Set-up and downtime Cleanup and rest periods Fringe benefits $12.00 10% of wage rate 20% of actual labour time 30% of actual labour time 20% of wage rate

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter7: Allocating Costs Of Support Departments And Joint Products

Section: Chapter Questions

Problem 1CE: The expected costs for the Maintenance Department of Stazler, Inc., for the coming year include:...

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Determine the break-even point in terms of number of units produced per month using the following data: (the costs are in pesos per unit) Selling price per unit=P600.00 Total monthly overhead expenses=P428,000.00 Labor cost=P115.00 Cost of materials=P76.00 Other variable cost=P2.32
Thane Company is interested in establishing the relationship between electricity costs and machine hours. Data have been collected and a regression analysis prepared using Excel. The monthly data and the regression output follow: Month Machine Hours Electricity Costs January 2,500 $ 18,400 February 2,900 21,000 March 1,900 13,500 April 3,100 23,000 May 3,800 28,250 June 3,300 22,000 July 4,100 24,750 August 3,500 22,750 September 2,000 15,500 October 3,700 26,000 November 4,700 31,000 December 4,200 27,750 Summary Output Regression Statistics Multiple R 0.965 R Square 0.932 Adjusted R2 0.925 Standard Error 1,425.18 Observations 12.00 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Intercept 3,726.88 1,682.82 2.21 0.05 (22.69) 7,476.45 Machine Hours 5.77 0.49 11.7 0.00 4.67 6.87 The percent of the total variance that can be explained by the regression is:…
Using the information in the previous exercises about Marleys Manufacturing, determine the operating income for department B, assuming department A sold department B 1,000 units during the month and department A reduces the selling price to the market price.
The cost data for BC Billing Solutions for the year 2020 is as follows: Using the high-low method, express the companys overtime wages as an equation where x represents number of invoices processed. Assume BC has monthly fixed costs of $3,800. Predict the overtime wages if 9,000 invoices are processed. Predict the overtime wages if 6,500 invoices are processed. Using Excel, create a scatter graph of the cost data and explain the relationship between the number of invoices processed and overtime wage expense.
The expected costs for the Maintenance Department of Stazler, Inc., for the coming year include: Fixed costs (salaries, tools): 64,900 per year Variable costs (supplies): 1.35 per maintenance hour Estimated usage by: Actual usage by: Required: 1. Calculate a single charging rate for the Maintenance Department. 2. Use this rate to assign the costs of the Maintenance Department to the user departments based on actual usage. Calculate the total amount charged for maintenance for the year. 3. What if the Assembly Department used 4,000 maintenance hours in the year? How much would have been charged out to the three departments?
Use the information below to answer the following two questions: Chamomile Inc. is a manufacturing company whose total manufacturing overhead costs fluctuate somewhat from month to month according to the number of machine-hours worked in its production facility. These costs for the last four months in 2019 are given below. Machine-hours Total manufacturing overhead September 6,500 62,500 70,500 October 9,000 November 5,000 10,000 $ 55,000 December $ 70,000 The manufacturing overhead costs above consist of rent, maintenance, and utilities. The company has analyzed these costs at the 5,000 machine-hours level of activity as follows: Rent (fixed) Maintenance (mixed) Utilites (mixed) 30,000 14,500 Total factory overhead costs 55,000 The company also found that the fixed maintenance cost in November was $4,500. 5 The company expects that it will work for 7,000 machine-hours in January 2020. Using the high-low method, how much is the estimated utilities cost in January 2020? (Round to the…
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Given the following cost and activity observations for Smithson Company's utilities, use the high-low method to determine Smithson's fixed costs per month. Round your final answer to the nearest dollar. Do not round interim calculations. Cost Machine Hours January $26,500 9,600 February 38,700 17,800 March 28,600 11,600 April 30,200 14,600 a.$9,774 b.$20,769 c.$39,094 d.$12,217
The chief executive of Dabid's salon is interested in accumulating some information on the overhead costs incurred by the Company. You have been asked to analyze the following six months' worth of data: Month Overhead Cost No. of Appointments 867 P 48,128 April May June 45,200 624 47,120 689 July August September 50,800 974 47,460 49,920 730 901 Using the least squares regression method, give an estimate of the fixed cost for each month P34,371.72 P35,631.77 P36,804.09 O P37,545.70
Identifying the Parts of the Cost Formula; Calculating Monthly, Quarterly, and Yearly Costs Using a Cost Formula Based on Monthly Data Gordon Company's controller, Eric Junior, estimated the following formula, based on monthly data, for overhead cost: Overhead Cost = $209,000 + ($82 x Direct Labor Hours) Required: 1. Select the term in the right column that corresponds to the term in the left column. Overhead cost Dependent variable v $209,000 Fixed cost (intercept) v $82 Variable rate (slope) Direct labor hours Independent variable v 2. If next month's budgeted direct labor hours equal 19,000, what is the budgeted overhead cost? 1,767,000 V 3. If next quarter's budgeted direct labor hours equal 95,000, what is the budgeted overhead cost? 4. If next year's budgeted direct labor hours equal 380,000, what is the budgeted overhead cost? $