Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“24. Kelson Company applies overhead[…]
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“23. Steele Company has the following estimated costs for next year: Direct materials $20,000 Direct labor 60,000 Sales commissions 80,000 Salary of production supervisor 40,000 Indirect materials 8,000 Advertising expense 16,000 Rent on factory equipment 20,000 Steele estimates that 10,000 direct labor hours and 16,000 machine hours will be worked during the year. If overhead is applied on the basis of machine hours, the overhead rate per hour will be: a. $4.25 b. $8.00 c. $9.00 d. $10.25”
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Read more“22. For 19×4, Parsons Company incurred $250,000 in actual manufacturing overhead cost. The Manufacturing Overhead account showed that overhead was overapplied in the amount of $12,000 for the year. If the predetermined overhead rate was $8.00 per direct labor hour, how many hours were worked during the year? a. 31,250 hours b. 30,250 hours c. 32,750 hours d. 29,750 hours”,”3Number of hours worked during the year:Applied MOH = Actual MOH + Overapplied overhead = 250,000 + 12,000 = $262,000Actual Hrs = Applied MOH/ = 262,000 /= 32,750 Hrs. PredeterminedRate 8.0023.The overhead rate per hour:= Estimated MOH / Estimated activity base= (40,000+8,000+20,000)/16
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Read more“21. The work in process account of a manufacturing firm shows a balance of $3,000 at the end of an accounting period. The job cost sheets of two uncompleted jobs show charges of $500 and $300 for materials used, and charges of $400 and $600 for direct labor used. From this information, it appears that the company is using a predetermined overhead rate, as a percentage of direct labor costs, of a. 83% b. 120% c. 40% d. 250%”,”2Total Cost for uncompleted Jobs = $3,000 – Cost of Raw Materials (800) – DL Cost (1000) = App. MOH 1,200Compare 1,200 to $1
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Read more“20. Malcolm Company uses direct labor hours as a base for applying predetermined factory overhead to production jobs. On September 1, the estimates for the month were: Factory overhead $17,000 Direct labor hours 13,600 During September, the actual production figures were: Factory overhead $18,500 Direct labor hours 12,000 The cost records for September will show a. Overapplied overhead of $3,500 b. Underapplied overhead of $2,000 c. Overapplied overhead of $1,500 d. Underapplied overhead of $3,500”,”4Predetermined rate = Estimated MOH/ Estimated DLHPredetermined rate = 17,000 = $1.25/DLH 13,600Applied MOH = DLH x predetermined rateApplied MOH = 12,000 x 1.25 = $15,000Compare to $18,500: Underapplied by 3
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Read more“19. Precision Company used a predetermined overhead rate during 19×2 of $3 per direct labor hour, based on an estimate of 24,000 direct labor hours to be worked during the year. Actual costs and activity during 19×2 were: Actual manufacturing overhead cost incurred $84,000 Actual direct labor hours worked 27,000 The under- or overapplied overhead for 19×2 would be a. $3,000 underapplied b. $3,000 overapplied c. $12,000 underapplied d. $9,000 overapplied”,”1The under or overapplied overhead for 19×2 would be:Applied MOH = Predetermined Rate x Actual Hours3 x 27,000 = $81,000Actual MOH – Applied MOH = Over or (Under)84,000 – 81
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Read more“18. Jameson Company has the following estimated costs for the next year: Direct materials $ 5,000 Direct labor 19,000 Rent on factory building 16,000 Sales salaries 24,000 Depreciation on factory equipment 7,000 Indirect labor 11,000 Production supervisor’s salary 14,000 Jameson estimates that 24,000 direct labor hours will be worked during the year. If overhead is applied on the basis of direct labor hours, the overhead rate per hour will be: a. $2.00 b. $2.79 c. $3.00 d. $4.00”,”1The overhead rate per hour:Predetermined OH rate = Estimated MOH costs / Estimated activity base:= (16,000+7,000+11,000+14,000)/24
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Read more“17. Compute the amount of direct materials used during August if $25,000 of raw materials was purchased during the month and the inventories were as follows: Balance Balance Inventories August 1 August 31 Raw Materials $ 5,000 $ 3,000 Work in process 13,000 16,000 Finished goods 25,000 27,000 a. $16,000 b. $19,000 c. $23,000 d. $27,000”,”4Direct materials used during August = Beginning balance of raw materials + Purchases – Ending balance of raw materials 5,000 + 25,000 – 3,000 = $27
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Read more“16. If a company applies overhead to production on the basis of a predetermined rate, a debit balance in the manufacturing overhead account at the end of the period means that a. actual overhead cost was greater than the amount charged to production. b. actual overhead cost was less than the amount of direct labor cost. c. more overhead cost has been charged to production than has been charged to finished goods during the period. d. actual overhead cost was less than the amount charged to production.”
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Read more“15. Under a job costing system, the dollar amount of the entry involved in the transfer of inventory from work in process to finished goods is the sum of the costs charged to all jobs a. started in process during the period. b. in process during the period. c. completed and sold during the period. d. completed during the period.”
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