Asked by Chih-Hsiang Chang on Apr 25, 2024
Verified
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
Overhead Applied
The portion of estimated overhead costs allocated to individual products or job orders based on a predetermined rate or method.
Departments
Organizational units within a company, each specializing in a particular area of operation.
- Develop proficiency in the application of predetermined overhead rates specific to departments, with an allocation base of machine-hours.
Verified Answer
NP
Nikhil Patel8 days ago
Final Answer :
A
Explanation :
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 labor-hour × 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 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: 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:
= $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 labor-hour × 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 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: 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:
Learning Objectives
- Develop proficiency in the application of predetermined overhead rates specific to departments, with an allocation base of machine-hours.
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