Exercise 3-4 (Algo) Underapplied and Overapplied Overhead [LO3-4] Osborn Manufacturing uses a predetermined overhead rate of $20.20 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $282,800 of total manufacturing overhead for an estimated activity level of 14,000 direct labor-hours. The company actually incurred $279,000 of manufacturing overhead and 13,500 direct labor-hours during the period. Required: 1. Determine the amount of underapplied or overapplied manufacturing overhead for the period. 2. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the journal entry to dispose of the underapplied or overapplied overhead increase or decrease the company's gross margin? By how much? 1. Manufacturing overhead 2. The gross margin would by by

Exercise 3-4 (Algo) Underapplied and Overapplied Overhead [LO3-4] Osborn Manufacturing uses a predetermined overhead rate of $20.20 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $282,800 of total manufacturing overhead for an estimated activity level of 14,000 direct labor-hours. The company actually incurred $279,000 of manufacturing overhead and 13,500 direct labor-hours during the period. Required: 1. Determine the amount of underapplied or overapplied manufacturing overhead for the period. 2. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the journal entry to dispose of the underapplied or overapplied overhead increase or decrease the company's gross margin? By how much? 1. Manufacturing overhead 2. The gross margin would by by

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Description: nkt.1 Exercise 3-4 (Algo) Underapplied and Overapplied Overhead [LO3-4]Osborn Manufacturing uses a predetermined overhead rate of $20.20 per direct labor-hour. This predetermined rate was based on acost formula that estimates $282,800 of total manufa

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter4: Job Order Costing

Section: Chapter Questions

Problem 8PA: Coops Stoops estimated its annual overhead to be $85,000 and based its predetermined overhead rate...

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Problem 7-47 (Algo) Estimate Machine-Hours Worked from Overhead Data (LO 7-3) Melbourne Company estimated that machine-hours for the year would be 39,100 hours and overhead (all fixed) would be $144,670. Melbourne applies its overhead on the basis of machine-hours. During the year, all overhead costs were exactly as planned ($144,670). There was $22,200 in overapplied overhead. Required: How many machine-hours were worked during the period? (Do not round intermediate calculations.)
Exercise 3-4 (Algo) Underapplied and Overapplied Overhead [LO3-4] Osborn Manufacturing uses a predetermined overhead rate of $19.40 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $256,080 of total manufacturing overhead for an estimated activity level of 13,200 direct labor-hours. The company actually incurred $251,000 of manufacturing overhead and 12,700 direct labor-hours during the period. Required: 1. Determine the amount of underapplied or overapplied manufacturing overhead for the period. 2. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the journal entry to dispose of the underapplied or overapplied overhead increase or decrease the company's gross margin? By how much? 1. Manufacturing overhead 2. The gross margin would by by
ces Exercise 2-1 (Algo) Compute a Predetermined Overhead Rate [LO2-1] Harris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 39,000 direct labor-hours would be required for the period's estimated level of production. The company also estimated $511,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $2.00 per direct labor-hour. Harris's actual manufacturing overhead cost for the year was $661,726 and its actual total direct labor was 39,500 hours. Required: Compute the company's plantwide predetermined overhead rate for the year. (Round your answer to 2 decimal places.) Predetermined overhead rate per DLH
Problem 7-50 (Algo) Estimate Direct Labor Costs from Overhead Data (LO 7-2) Kenmore Fabrication estimated that direct labor cost for the year would be $651,200. The company also estimated that fixed overhead would be $488,400 and variable overhead would be 35 percent of direct labor cost. Kenmore applies its overhead on the basis of direct labor cost. During the year, all fixed overhead costs were exactly as planned ($488,400) and variable overhead was also incurred as expected. There was $32,100 in underapplied overhead. Required: How much did Kenmore spend on direct labor cost during the period? Actual direct labor cost
Exercise 7-32 (Algo) Prorate Over- or Underapplied Overhead (LO 7- 3) Yarra Fabrication estimates that its manufacturing overhead will be $2,316,800 in year 1. It further estimates that direct material costs will amount to $1,448,000. Actual manufacturing overhead costs for the year were $2,460,000. Actual direct materials costs were $1,610,000. Manufacturing overhead is applied to jobs based on direct materials cost using predetermined rates. The total applied overhead for the year was $2,576,000 The balance in each of the inventory accounts is as follows. Work-in-process inventory $ 484,000 Finished goods inventory $ 1,144,000 Cost of goods sold $ 7,172,000 Required: Prepare an entry to allocate the over- or underapplied overhead. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Nova Company's total overhead cost at various levels of activity are presented below Total Overhead Machine- Month Hours Cost April May June 52,000 42,000 62,000 72,000 $203,860 $181,060 $226,660 $249,460 July Assume that the total overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 42,000 machine-hour level of activity is: Utilities (variable) Supervisory salaries (fixed) Maintenance (mixed) Total overhead cost S 50,400 67,000 63.660 181,060 Nova Company's management wants to break down the maintenance cost into its variable and fixed cost elements Required: 1. Estimate how much of the $249,460 of overhead cost in July was maintenance cost. (Hint: To do this, it may be helpful to first determine how much of the $249,460 consisted of utilities and supervisory salaries. Think about the behavior of variable and fixed costs!) (Do not round intermediate calculations.) Maintenance cost in July 2. Using the high-low method,…
services XYZ industries applies overhead based on direct labor cost. The following information was available for the last year: Actual manufacturing overhead OMR50,000; Underapplied manufacturing overhead OMR10,400; Actual Prime cost OMR52,000; Actual Direct material cost OMR19,000; Estimated direct labor cost OMR41,000 overhead for the year? What was the estimated man turi Select one: O a. OMR49,200 O b.OMR39,600 O c. None of the answers given O d. OMR46,800 e OMRS1,600 ge Next page
Exercise 2-1 (Algo) Compute a Predetermined Overhead Rate [LO2-1] Harris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 38,000 direct labor-hours would be required for the period’s estimated level of production. The company also estimated $502,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $2.00 per direct labor-hour. Harris’s actual manufacturing overhead cost for the year was $645,280 and its actual total direct labor was 38,500 hours. Required: Compute the company’s plantwide predetermined overhead rate for the year. (Round your answer to 2 decimal places.) predetermined overhead rate: per DLH
201 Exercise 7-35 (Static) Prorate Over- or Underapplied Overhead (LO 7-3) Linzee Liners estimates that its manufacturing overhead will be $1,725,000 in Year 1. It further estimates that direct labor costs will amount to $750,000. During March, Linzee worked on four jobs with actual direct labor costs of $35,000 for Job 0301, $22,500 for Job 0302, $32,000 for Job 0303, and $16,000 for Job 0304. Actual manufacturing overhead costs for the year were $1,710,000. Actual direct labor costs for the year were $735,000. Manufacturing overhead is applied to jobs based on direct labor costs using predetermined rates. The amount of overhead applied in each of the inventory accounts at the end of Year 1 is as follows: Work-in-process inventory Finished goods inventory. Cost of goods sold Required: Prepare an entry to allocate the over- or underapplied overhead. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No A $ 33,810 $…
Exercise 7-35 (Static) Prorate Over- or Underapplied Overhead (LO 7-3) Linzee Liners estimates that its manufacturing overhead will be $1,725,000 in Year 1. It further estimates that direct labor costs will amount to $750,000. During March, Linzee worked on four jobs with actual direct labor costs of $35,000 for Job 0301, $22,500 for Job 0302, $32,000 for Job 0303, and $16,000 for Job 0304. Actual manufacturing overhead costs for the year were $1,710,000. Actual direct labor costs for the year were $735,000. Manufacturing overhead is applied to jobs based on direct labor costs using predetermined rates. The amount of overhead applied in each of the inventory accounts at the end of Year 1 is as follows: Work-in-process inventory $ 33,810 $ 270,480 Finished goods inventory Cost of goods sold $ 1,386,210 Required: Prepare an entry to allocate the over- or underapplied overhead. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account…
O e. $2,636 Company XYZ uses machine hours to allocate its manufacturing overhead. The company estimates that total machine hours to be operated next year are 190,000 hours. The estimated variable overhead is $9 per hour and the estimated fixed overhead costs are $152,000. Calculate the predetermined overhead rate. Select one: O a. $10.80 O b. $9.80 O c. $0.10 O d. $0.80 O e. None of the answers given Finish attempt . ge OADUa Prisc F9 F6 F7 F3 F4 F2 23 24 8 6 3
tunng costs incurred during the period. Eśraa Al Hajri O d. Less than the total amount of overhead actually incurred during the period. 129741 e. More than the actual direct manufacturing costs incurred during the period. 3 4 5 6 10 sestion 2 at yet swered Company XYZ uses direct labor hours to allocate its manufacturing overhead. Manufacturing overhead was estimated to be $410,000 for the year. Actual manufacturing overhead was $415,000 and actual labor hours were 22,000. The Finish attempt .. estimated direct labor hours for the year was 20,000. The amount of manufacturing overhead applied to production arked out of would be: - Flag uestion Select one: O a. $462,000 O b. None of the answers given O c. $410,000 O d. $451,000 O e. $372,727 Next page Time left 0:34: dtv MacRock r DII DD F10 888 F9 FB F7 F6 F4 F3 F1 & 23 $ % 6 1 7 V 8 A 1 2 4 T Y .... R Q W 6:'