Case 1 Best Pty Ltd applies overhead on the basis of direct labour costs. The company...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Case 1 Best Pty Ltd applies overhead on the basis of direct labour costs. The company estimates annual overhead costs will be $760,000 and annual direct labour costs will be $950,000. During February, Best Pty Ltd works on two jobs: A16 and B17. Summary Data concerming these jobs are as follows. Manufacturing Costs Incurred Purchased $54,000 of raw materials on account. Factory Labour $76,000 plus $4,000 employer payroll taxes. Manufacturing overhead exclusive of indirect materials and indirect labour $59,800. Assignment of Costs Direct materials: Job A16 $27,000 and Job B17 $21,000 Indirect materials: $3,000 Direct Labour: Job A16 $52,000 and Job B17 $26,000 Indirect Labour: $2,000 The company completed Job A16 and sold it on account for S150,000. Job B17 was only partially completed. Instructions a. Compute the predetermined overhead rate (5 Marks). b. Journalize the February transactions and explain the meaning of each journals relate to the costing system (5 Marks). c. What was the amount of under- or overlapped manufacturing overhead? Explain what the meaning of under or overlapped manufacturing overhead (5 Marks) Case 1 Best Pty Ltd applies overhead on the basis of direct labour costs. The company estimates annual overhead costs will be $760,000 and annual direct labour costs will be $950,000. During February, Best Pty Ltd works on two jobs: A16 and B17. Summary Data concerming these jobs are as follows. Manufacturing Costs Incurred Purchased $54,000 of raw materials on account. Factory Labour $76,000 plus $4,000 employer payroll taxes. Manufacturing overhead exclusive of indirect materials and indirect labour $59,800. Assignment of Costs Direct materials: Job A16 $27,000 and Job B17 $21,000 Indirect materials: $3,000 Direct Labour: Job A16 $52,000 and Job B17 $26,000 Indirect Labour: $2,000 The company completed Job A16 and sold it on account for S150,000. Job B17 was only partially completed. Instructions a. Compute the predetermined overhead rate (5 Marks). b. Journalize the February transactions and explain the meaning of each journals relate to the costing system (5 Marks). c. What was the amount of under- or overlapped manufacturing overhead? Explain what the meaning of under or overlapped manufacturing overhead (5 Marks)
Expert Answer:
Answer rating: 100% (QA)
Answer Solution a Predetermined overhead rate Total estimated overheadTotal DL cost 760000950000 08 ... View the full answer
Related Book For
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-0078025778
17th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
Posted Date:
Students also viewed these accounting questions
-
Blaze Corp. applies overhead on the basis of direct labor hours. For the month of March, the company planned production of 8,000 units (80% of its production capacity of 10,000 units) and prepared...
-
James Corp. applies overhead on the basis of direct labor hours. For the month of May, the company planned production of 8,000 units (80% of its production capacity of 10,000 units) and prepared the...
-
A department store apportions payroll costs on the basis of the number of payroll checks issued. Accounting costs are apportioned on the basis of the number of reports. The payroll costs for the year...
-
Two capillary tubes of the same radius r but of lengths & and 1 are fitted horizontally to the bottom of a tall vessel containing a liquid at constant Pressure head and flowing through these tubes....
-
Consider the following investment categories: A. AC investment B. FVTPL investment C. FVTOCI investment D. Associate E. Subsidiary F. Joint venture G. Cost An investor company that is a public...
-
How many copper atoms are in a copper penny with a mass of 3.10 g? (Assume that the penny is composed of pure copper.) SORT You are given the mass of copper and asked to find the number of copper...
-
In a random sample of 150 complaints filed against a construction company for mixing excess sand in their concrete mixture, 95 complaints showed that the proportion of sand in the mix exceeded 75...
-
Inferring Operating Transactions and Preparing an Income Statement and Balance Sheet Kate's Kite Company (a corporation) sells and repairs kites from manufacturers around the world. Its stores are...
-
Discuss how you would engage various stakeholders within the school community (e.g., parents, teachers, students, administrators).
-
New Age Solar sells and installs solar panels for residential homes. The companys sales representatives contact and pay a personal visit to potential customers to present the benefits of installing...
-
In which case is an employer strictly liable for illegal discrimination, meaning it has no defenses?
-
Coffin Corporation wants to buy a new hearse for $\$ 60,000$. It will last for five years. They expect to make 100 trips per year. Coffin uses a discount rate of 6 percent. If they charge $\$ 150$...
-
Which system of electing judges, partisan or nonpartisan, do you think is better for preserving the goals of the judicial system?
-
Do you think that there should be more cooperation or sharing of administrative responsibilities either among the court staff or among judges to improve the scheduling and timing problems?
-
Suppose that you have $\$ 50,000$ available today and can invest it at $7 %$ per year. How long will it be before you have accumulated $\$ 500,000$ in the investment?
-
Given that most judges were attorneys who specialized in only one or two areas of law, should they be required to learn (take classes on) other areas of law rather than leaving it up to them to put...
-
MNE activities can interfere with a government's ability to control its own economy, social structure, and political system. Group of answer choices True False
-
Suppose the spot and six-month forward rates on the Norwegian krone are Kr 5.78 and Kr 5.86, respectively. The annual risk-free rate in the United States is 3.8 percent, and the annual risk-free rate...
-
On September 1, 2015, Evansville Lumber Company issued $80 million in 20-year, 10 percent bonds payable. Interest is payable semiannually on March 1 and September 1. Bond discounts and premiums are...
-
Patterson Company reported net income for the current year of $722,000. During the year the companys accounts receivable increased by $50,000, inventory decreased by $23,000, accounts payable...
-
The following computation of the materials variances of Weitzen Foods is incomplete. The missing data are labeled (a) through (d). Materials price variance = 4,000 pounds [(a) standard price $7.00...
-
A and B contribute $20,000 each to form the AB partnership and agree to share profits and losses 80% to A and 20% to B. ABs partnership items for the year are as follows: (a) What is As portion of...
-
A and B form the AB equal general partnership. A contributes \($10,000\) cash and a depreciable asset with an adjusted basis of \($40,000\) and a fair market value of \($90,000.\) B contributes...
-
Which of the following taxpayers is engaged in a specified service trade or business? (a) A lawyer (b) An architect (c) A professional soccer player (d) A freelance writer who publishes articles and...
Study smarter with the SolutionInn App