Hultquist Corporation has two manufacturing departments--Forming and Customizing. The company used the following dataat the beginning of the period to calculate predetermined overhead rates:Estimated total machine-hours (MHS)Estimated total fixed manufacturing overhead costEstimated variable manufacturing overhead cost per MHForming Customizing Total6,000 4,000 10,000$20,400$ 2.50$9,600 $30,000$ 5.00During the period, the company started and completed two jobs-Job C and Job L. Data concerning those two jobs follow:Job C Job L$15,500 $9,100$22,300 $9,3001,250 4,7501,250 2,750Direct materialsDirect labor costForming machine-hoursCustomizing machine-hours Required:a. Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours.Calculate that overhead rate. (Round your answer to 2 decimal places.)

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Description: Hultquist Corporation has two manufacturing departments--Forming and Customizing. The company used the following dataat the beginning of the period to calculate predetermined overhead rates:Estimated total machine-hours (MHS)Estimated total fixed ma

Overhead recovery rate can be computed by dividing the Total Estimated Overhead by the Estimated…

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Hultquist Corporation has two manufacturing departments--Forming at the beginning of the period to calculate predetermined overhead rates: Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH and Customizing. The company used the following dat Forming Customizing Total 6,000 4,000 10,000 $20,400 $9,600 $30,000 $5.00 $ 2.50

Hultquist Corporation has two manufacturing departments--Forming at the beginning of the period to calculate predetermined overhead rates: Estimated total machine-hours (MHS) Estimated total fixed manufacturing overhead cost Estimated variable manufacturing overhead cost per MH and Customizing. The company used the following dat Forming Customizing Total 6,000 4,000 10,000 $20,400 $9,600 $30,000 $5.00 $ 2.50

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 11E: Ripley, Inc., costs products using a normal costing system. The following data are available for...

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Lansing. Inc., provided the following data for its two producing departments: Machine hours are used to assign the overhead of the Molding Department, and direct labor hours are used to assign the overhead of the Polishing Department. There are 30,000 units of Form A produced and sold and 50,000 of Form B. Required: 1. Calculate the overhead rates for each department. 2. Using departmental rates, assign overhead to live two products and calculate the overhead cost per unit. How does this compare with the plantwide rate unit cost, using direct labor hours? 3. What if the machine hours in Molding were 1,200 for Form A and 3,800 for Form B and the direct labor hours used in Polishing were 5,000 and 15,000, respectively? Calculate the overhead cost per unit for each product using departmental rates, and compare with the plantwide rate unit costs calculated in Requirement 2. What can you conclude from this outcome?
Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
Primera Company produces two products and uses a predetermined overhead rate to apply overhead. Primera currently applies overhead using a plantwide rate based on direct labor hours. Consideration is being given to the use of departmental overhead rates where overhead would be applied on the basis of direct labor hours in Department 1 and on the basis of machine hours in Department 2. At the beginning of the year, the following estimates are provided: Actual results reported by department and product during the year are as follows: Required: 1. Compute the plantwide predetermined overhead rate and calculate the overhead assigned to each product. 2. Calculate the predetermined departmental overhead rates and calculate the overhead assigned to each product. 3. Using departmental rates, compute the applied overhead for the year. What is the under- or overapplied overhead for the firm? 4. Prepare the journal entry that disposes of the overhead variance calculated in Requirement 3, assuming it is not material in amount. What additional information would you need if the variance is material to make the appropriate journal entry?
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