Ch2, Job-Order Costing Calculating Unit Product Costs Part 13

[QUESTION] 215. The total amount of overhead applied in both departments to Job T924 is closest to: A) $1,157 B) $548 C) $609 D) $1,705 Answer: A Difficulty: 2 Medium Learning Objective: 02-01 Learning Objective: 02-02 Learning Objective: 02-04 Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref39 Feedback: Forming Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per machine-hour × Total machine-hours in the department) = $102,400 + ($2.30 per machine-hour × 16,000 machine-hours) = $102,400 +$36,800 = $139,200 Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base incurred = $139,200 ÷ 16,000 machine-hours = $8.70 per machine-hour Overhead applied to a particular job = Predetermined overhead rate × Amount of the allocation base incurred by the job = $8.70 per machine-hour × 70 machine-hours = $609 Assembly Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per direct laborhour × Total direct labor-hours in the department) = $55,200 + ($4.50 per direct labor-hour × 6,000 direct labor-hours) = $55,200 + $27,000 = $82,200 Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base incurred = $82,200 ÷6,000 direct labor-hours = $13.70 per direct labor-hour Overhead applied to a particular job = Predetermined overhead rate × Amount of the allocation base incurred by the job = $13.70 per direct labor-hour × 40 direct labor-hours = $548 Overhead applied to Job T924 Forming Department........................ Assembly Department..................... Total................................................. $609 548 $1,157 Reference: CH02-Ref40 Merati Corporation has two manufacturing departments--Forming and Assembly. The company used the following data at the beginning of the year to calculate predetermined overhead rates: Estimated total machine-hours (MHs)................................. Estimated total fixed manufacturing overhead cost............. Estimated variable manufacturing overhead cost per MH. . . Forming Assembly Total 5,000 5,000 10,000 $28,000 $10,500 $38,500 $1.80 $2.60 During the most recent month, the company started and completed two jobs--Job B and Job L. There were no beginning inventories. Data concerning those two jobs follow: Forming machine-hours........... Assembly machine-hours......... Job B Job L 3,400 1,600 2,000 3,000 [QUESTION] 216. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments. The departmental predetermined overhead rate in the Forming Department is closest to: A) $5.60 B) $7.40 C) $1.80 D) $6.05 Answer: B Difficulty: 2 Medium Learning Objective: 02-01 Learning Objective: 02-04 Topic Area: Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref40 Feedback: Forming Department predetermined overhead rate: Estimated fixed manufacturing overhead.......................................................... $28,000 Estimated variable manufacturing overhead ($1.80 per MH × 5,000 MHs)...... 9,000 Estimated total manufacturing overhead cost (a).............................................. $37,000 Estimated total machine-hours (b).................................................................... 5,000 MHs Departmental predetermined overhead rate (a) ÷ (b)....................................... $7.40 per MH [QUESTION] 217. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments. The departmental predetermined overhead rate in the Assembly Department is closest to: A) $2.60 B) $4.70 C) $6.05 D) $2.10 Answer: B Difficulty: 2 Medium Learning Objective: 02-01 Learning Objective: 02-04 Topic Area: Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref40 Feedback: Assembly Department predetermined overhead rate: Estimated fixed manufacturing overhead.......................................................... $10,500 Estimated variable manufacturing overhead ($2.60 per MH × 5,000 MHs)...... 13,000 Estimated total manufacturing overhead cost (a).............................................. $23,500 Estimated total machine-hours (b).................................................................... 5,000 MHs Departmental predetermined overhead rate (a) ÷ (b)...................................... $4.70 per MH [QUESTION] 218. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. The manufacturing overhead applied to Job B is closest to: A) $9,400 B) $25,160 C) $32,670 D) $34,560 Answer: D Difficulty: 2 Medium Learning Objective: 02-01 Learning Objective: 02-02 Learning Objective: 02-04 Topic Area: Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref40 Feedback: Forming Department predetermined overhead rate: Estimated fixed manufacturing overhead.......................................................... Estimated variable manufacturing overhead ($1.80 per MH × 5,000 MHs)...... Estimated total manufacturing overhead cost (a).............................................. Estimated total machine-hours (b).................................................................... Departmental predetermined overhead rate (a) ÷ (b)....................................... $28,000 9,000 $37,000 5,000 MHs $7.40 per MH Assembly Department predetermined overhead rate: Estimated fixed manufacturing overhead.......................................................... Estimated variable manufacturing overhead ($2.60 per MH × 5,000 MHs)...... Estimated total manufacturing overhead cost (a).............................................. Estimated total machine-hours (b).................................................................... Departmental predetermined overhead rate (a) ÷ (b)...................................... $10,500 13,000 $23,500 5,000 MHs $4.70 per MH Manufacturing overhead applied to Job B: Forming ($7.40 per MH × 3,400 MHs)................. Assembly ($4.70 per MH × 2,000 MHs)............... Total manufacturing overhead applied................. $25,160 9,400 $34,560 [QUESTION] 219. Assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both production departments. The manufacturing overhead applied to Job L is closest to: A) $27,830 B) $11,840 C) $25,940 D) $14,100 Answer: C Difficulty: 2 Medium Learning Objective: 02-01 Learning Objective: 02-02 Learning Objective: 02-04 Topic Area: Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref40 Feedback: Forming Department predetermined overhead rate: Estimated fixed manufacturing overhead.......................................................... $28,000 Estimated variable manufacturing overhead ($1.80 per MH × 5,000 MHs)...... 9,000 Estimated total manufacturing overhead cost (a).............................................. $37,000 Estimated total machine-hours (b).................................................................... Departmental predetermined overhead rate (a) ÷ (b)....................................... Assembly Department predetermined overhead rate: Estimated fixed manufacturing overhead.......................................................... Estimated variable manufacturing overhead ($2.60 per MH × 5,000 MHs)...... Estimated total manufacturing overhead cost (a).............................................. Estimated total machine-hours (b).................................................................... Departmental predetermined overhead rate (a) ÷ (b)...................................... Manufacturing overhead applied to Job L: Forming ($7.40 per MH × 1,600 MHs)................. Assembly ($4.70 per MH × 3,000 MHs)............... Total manufacturing overhead applied................. 5,000 MHs $7.40 per MH $10,500 13,000 $23,500 5,000 MHs $4.70 per MH $11,840 14,100 $25,940 Reference: CH02-Ref41 Barbeau Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling Department’s predetermined overhead rate is based on machine-hours and the Customizing Department’s predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machine-hours.................................................................. Direct labor-hours.............................................................. Total fixed manufacturing overhead cost........................... Variable manufacturing overhead per machine-hour......... Variable manufacturing overhead per direct labor-hour..... Milling 17,000 2,000 $119,000 $1.60 Customizing 13,000 5,000 $42,000 $4.30 During the current month the company started and finished Job A492. The following data were recorded for this job: Job A492: Machine-hours............. Direct labor-hours......... Milling 90 20 Customizing 20 50 [QUESTION] 220. The estimated total manufacturing overhead for the Customizing Department is closest to: A) $63,500 B) $21,500 C) $42,000 D) $33,853 Answer: A Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-04 Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref41 Feedback: Customizing Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per direct laborhour × Total direct labor-hours in the department) = $42,000 + ($4.30 per direct labor-hour × 5,000 direct labor-hours) = $42,000 + $21,500 = $63,500 [QUESTION] 221. The amount of overhead applied in the Milling Department to Job A492 is closest to: A) $146,200.00 B) $144.00 C) $756.00 D) $774.00 Answer: D Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-02 Learning Objective: 02-04 Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref41 Feedback: Milling Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per machine-hour × Total machine-hours in the department) = $119,000 + ($1.60 per machine-hour × 17,000 machine-hours) = $119,000 +$27,200 = $146,200 Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base incurred = $146,200 ÷ 17,000 machine-hours = $8.60 per machine-hour Overhead applied to a particular job = Predetermined overhead rate × Amount of the allocation base incurred by the job = $8.60 per machine-hour × 90 machine-hours = $774 Reference: CH02-Ref42 Kroeker Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling Department’s predetermined overhead rate is based on machine-hours and the Customizing Department’s predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machine-hours.................................................................. Direct labor-hours.............................................................. Total fixed manufacturing overhead cost........................... Variable manufacturing overhead per machine-hour......... Variable manufacturing overhead per direct labor-hour..... Milling 17,000 1,000 $112,200 $1.70 Customizing 12,000 9,000 $81,000 $4.30 During the current month the company started and finished Job T898. The following data were recorded for this job: Job T898: Machine-hours............. Direct labor-hours......... Milling 80 20 Customizing 30 50 [QUESTION] 222. The estimated total manufacturing overhead for the Milling Department is closest to: A) $240,833 B) $141,100 C) $28,900 D) $112,200 Answer: B Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-04 Topic Area: Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref42 Feedback: Milling Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per machine-hour × Total machine-hours in the department) = $112,200 + ($1.70 per machine-hour × 17,000 machine-hours) = $112,200 +$28,900 = $141,100 [QUESTION] 223. The amount of overhead applied in the Customizing Department to Job T898 is closest to: A) $450.00 B) $119,700.00 C) $665.00 D) $215.00 Answer: C Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-02 Learning Objective: 02-04 Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Feedback: Customizing Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per direct laborhour × Total direct labor-hours in the department) = $81,000 + ($4.30 per direct labor-hour × 9,000 direct labor-hours) = $81,000 + $38,700 = $119,700 Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base incurred = $119,700 ÷9,000 direct labor-hours = $13.30 per direct labor-hour Overhead applied to a particular job = Predetermined overhead rate × Amount of the allocation base incurred by the job = $13.30 per direct labor-hour × 50 direct labor-hours = $665 Reference: CH02-Ref43 Petty Corporation has two production departments, Milling and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling Department’s predetermined overhead rate is based on machine-hours and the Finishing Department’s predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machine-hours.................................................................. Direct labor-hours.............................................................. Total fixed manufacturing overhead cost........................... Variable manufacturing overhead per machine-hour......... Variable manufacturing overhead per direct labor-hour..... Milling 20,000 2,000 $148,000 $1.90 Finishing 14,000 8,000 $88,000 [QUESTION] 224. The estimated total manufacturing overhead for the Milling Department is closest to: A) $408,000 B) $38,000 C) $148,000 $3.60 D) $186,000 Answer: D Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-04 Topic Area: Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref43 Feedback: Milling Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per machine-hour × Total machine-hours in the department) = $148,000 + ($1.90 per machine-hour × 20,000 machine-hours) = $148,000 +$38,000 = $186,000 [QUESTION] 225. The predetermined overhead rate for the Finishing Department is closest to: A) $5.84 per direct labor-hour B) $3.60 per direct labor-hour C) $11.00 per direct labor-hour D) $14.60 per direct labor-hour Answer: D Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-04 Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref43 Feedback: Finishing Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per direct labor-hour × Total direct labor-hours in the department) = $88,000 + ($3.60 per direct labor-hour × 8,000 direct labor-hours) = $88,000 + $28,800 = $116,800 Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base incurred = $116,800 ÷8,000 direct labor-hours = $14.60 per direct labor-hour Reference: CH02-Ref44 Garza Corporation has two production departments, Casting and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Casting Department’s predetermined overhead rate is based on machine-hours and the Customizing Department’s predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machine-hours.................................................................. Direct labor-hours.............................................................. Total fixed manufacturing overhead cost........................... Variable manufacturing overhead per machine-hour......... Variable manufacturing overhead per direct labor-hour..... Casting 20,000 1,000 $152,000 $2.10 Customizing 13,000 7,000 $68,600 $4.30 [QUESTION] 226. The estimated total manufacturing overhead for the Customizing Department is closest to: A) $54,110 B) $30,100 C) $98,700 D) $68,600 Answer: C Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-04 Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref44 Feedback: Customizing Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per direct laborhour × Total direct labor-hours in the department) = $68,600 + ($4.30 per direct labor-hour × 7,000 direct labor-hours) = $68,600 + $30,100 = $98,700 [QUESTION] 227. The predetermined overhead rate for the Casting Department is closest to: A) $9.70 per machine-hour B) $7.60 per machine-hour C) $2.10 per machine-hour D) $27.71 per machine-hour Answer: A Difficulty: 1 Easy Learning Objective: 02-01 Learning Objective: 02-04 Blooms: Apply AACSB: Analytical Thinking AICPA: BB Critical Thinking AICPA: FN Measurement Refer To: CH02-Ref44 Feedback: Casting Department overhead cost = Fixed manufacturing overhead cost + (Variable overhead cost per machine-hour × Total machine-hours in the department) = $152,000 + ($2.10 per machine-hour × 20,000 machine-hours) = $152,000 +$42,000 = $194,000 Predetermined overhead rate = Estimated total manufacturing overhead cost ÷ Estimated total amount of the allocation base incurred = $194,000 ÷ 20,000 machine-hours = $9.70 per machine-hour Reference: CH02-Ref45 Marciante Corporation has two production departments, Casting and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Casting Department’s predetermined overhead rate is based on machine-hours and the Finishing Department’s predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: Machine-hours.................................................................. Direct labor-hours.............................................................. Total fixed manufacturing overhead cost........................... Variable manufacturing overhead per machine-hour......... Variable manufacturing overhead per direct labor-hour..... Casting 17,000 2,000 $105,400 $1.70 Finishing 10,000 5,000 $52,000 $3.90