White Company has two departments, Cutting and Finishing. The company uses job-order costing and computes a...
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White Company has two departments, Cutting and Finishing. The company uses job-order costing and computes a predetermined overhead rate in each department. The Cutting Department bases its rate on machine-hours, and the Finishing Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates: Direct labor-hours Machine-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Required: Department Cutting Finishing 7,700 68,700 $ 380,000 76,000 2,400 $ 593,000 $ 3.00 8 $4.75 1. Compute the predetermined overhead rate for each department. 2. The job cost sheet for Job 203, which was started and completed during the year, showed the following: Department Direct labor-hours Machine-hours Direct materials Cutting Finishing 6 11 89 4 $ 780 $ 120 $ 360 $ 220 Direct labor cost Using the predetermined overhead rates you computed in requirement (1), compute the total manufacturing cost assigned to Job 203. 3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide predetermined overhead rate based on direct labor-hours, rather than using departmental rates? Complete this question by entering your answers in the tabs given below. Required 1 Required 2 Required 3 Compute the predetermined overhead rate for each department. Note: Round your answers to 2 decimal places. Predetermined overhead rate Cutting Department per MH Finishing Department per DLH White Company has two departments, Cutting and Finishing. The company uses job-order costing and computes a predetermined overhead rate in each department. The Cutting Department bases its rate on machine-hours, and the Finishing Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates: Direct labor-hours Machine-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Required: Department Cutting Finishing 7,700 68,700 $ 380,000 76,000 2,400 $ 593,000 $ 3.00 8 $4.75 1. Compute the predetermined overhead rate for each department. 2. The job cost sheet for Job 203, which was started and completed during the year, showed the following: Department Direct labor-hours Machine-hours Direct materials Cutting Finishing 6 11 89 4 $ 780 $ 120 $ 360 $ 220 Direct labor cost Using the predetermined overhead rates you computed in requirement (1), compute the total manufacturing cost assigned to Job 203. 3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide predetermined overhead rate based on direct labor-hours, rather than using departmental rates? Complete this question by entering your answers in the tabs given below. Required 1 Required 2 Required 3 Compute the predetermined overhead rate for each department. Note: Round your answers to 2 decimal places. Predetermined overhead rate Cutting Department per MH Finishing Department per DLH
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Related Book For
Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
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