Category: Accounting

“A company incurs $4,050,000 of overhead each year in three departments: Ordering and Receiving, Mixing, and Testing. The company prepares 2,000 purchase orders, works 50,000 mixing hours, and performs 1,500 tests per year in producing 200,000 drums of Goo and 600,000 drums of Slime. The following data are available:Department Expected use of Driver Cost Ordering and Receiving 2,000 $1,200,000 Mixing 50,000 1,500,000 Testing 1,500 1,350,000 Production information for Slime is as follows:Department Expected use of Driver Ordering and Receiving 1,600 Mixing 30,000 Testing 1,000 Compute the amount of overhead assigned to Slime.”,”$2,760

Managerial Accounting

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“Bangor Company manufactures two products, Velveeto and Fondant. Bangor has estimated overhead costs as follows: setting up machines ($160,000), machining ($300,000) and inspecting ($100,000). Information on the two products follows: Velveeto Fondant Direct labor hours 60,000 100,000 Machine setups 2,400 1,600 Machine hours 96,000 104,000 Inspections 3,200 2,800 Overhead is applied to Fondant using direct labor hours. What is the total amount of overhead charged to this product line using traditional costing?”,”$350,000Correct! The overhead rate is calculated by dividing estimated overhead divided by estimated direct labor hours. Then, the rate is multiplied by the actual activity. Rate = [($160,000 + $300,000 + $100,000) / 160,000 hours] = $3.50 per direct labor hourApplied = $3.50 × 100,000 = $350

Managerial Accounting

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jubilee frozen foods purchased new computer-controlled production machinery last year from advanced design. the equipment was purchased for 4.1 million and was paid for with cash. a representative from advanced design recently contacted jubilee management because advanced design has an even more efficient piece of machinery available. the new design would double the production output of the equipment purchased last year but would cost jubilee another 5.0 million. the old machinery was installed by an engineering firm; the same firm would be required to install the new machinery…… etc…….

Managerial Accounting

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“Bergeron Co. manufactures two printers, Pronto and Speedy. Total overhead of $1,260,000 is incurred by three departments: Setups $80,000; Machining $880,000; and Shipping $300,000. The company also incurs $40,000 of direct labor. Information concerning the two product lines is shown below: Pronto Speedy Machine setups 25 25 Machine hours 6,500 3,500 Orders shipped 225 375 Direct labor costs $100,000 $300,000”,”$535

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“Bergeron Co. manufactures two printers,[…]

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