A manufacturing business, Grimoak, Corp., organizes its production into four cost centers. Last month the company...
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A manufacturing business, Grimoak, Corp., organizes its production into four cost centers. Last month the company produced 60,000 items of product. Further details of the costs are included in the following table: Cost center Production overhead (excluding the factory rental) Floor area Machining 291,975 € 1,500 sq. m. Assembly & finishing Packaging 130,305 € 116,140 € 68,965 € 1,700 sq. m. 1,600 sq. m. Maintenance & repairs Total 2,100 sq. m. 6,900 sq. m. 607,385 € Maintenance & repairs is a service cost center that has worked 6,000 LH to Machining, 3,400 LH to Assembly & finishing and 5,800 LH to Packaging. Required: 1. Using the floor area as base of apportionment, compute the cost of the factory rental (23,115 €) of each cost center. 2. Calculate the overhead absorption rate for each department on the following basis: a. Machining machine time 120,000 MH b. Assembly & Finishing 30,000 LH c. Packaging direct labor hours units of production direct labor hours 60,000 items d. Maintenance & Repairs - 15,200 LH 3. The prime cost and timing details for one unit of production are: € Materials 16.20 Direct labor 19.00 Prime cost (or direct cost) 35.20 Each unit uses 2 hours of machine time in the machining department. Each unit uses 0.5 direct labor hours in the assembly and finishing department. Calculate the total production cost for one unit of the company's product. A manufacturing business, Grimoak, Corp., organizes its production into four cost centers. Last month the company produced 60,000 items of product. Further details of the costs are included in the following table: Cost center Production overhead (excluding the factory rental) Floor area Machining 291,975 € 1,500 sq. m. Assembly & finishing Packaging 130,305 € 116,140 € 68,965 € 1,700 sq. m. 1,600 sq. m. Maintenance & repairs Total 2,100 sq. m. 6,900 sq. m. 607,385 € Maintenance & repairs is a service cost center that has worked 6,000 LH to Machining, 3,400 LH to Assembly & finishing and 5,800 LH to Packaging. Required: 1. Using the floor area as base of apportionment, compute the cost of the factory rental (23,115 €) of each cost center. 2. Calculate the overhead absorption rate for each department on the following basis: a. Machining machine time 120,000 MH b. Assembly & Finishing 30,000 LH c. Packaging direct labor hours units of production direct labor hours 60,000 items d. Maintenance & Repairs - 15,200 LH 3. The prime cost and timing details for one unit of production are: € Materials 16.20 Direct labor 19.00 Prime cost (or direct cost) 35.20 Each unit uses 2 hours of machine time in the machining department. Each unit uses 0.5 direct labor hours in the assembly and finishing department. Calculate the total production cost for one unit of the company's product.
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Q 18 Req 1 Cost center Floor area Factory rental Machining 1500 23115150069005... View the full answer
Related Book For
Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
Posted Date:
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