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Ivahew [28]
3 years ago
9

When underapplied or overapplied manufacturing overhead is prorated, amounts can be assigned to which of the following accounts?

Multiple Choice
a. Raw-Material Inventory, Manufacturing Overhead, and Direct Labor.
b. Cost of Goods Sold, Work-in-Process Inventory, and Finished-Goods Inventory.
c. Work-in-Process Inventory, Raw-Material Inventory, and Cost of Goods Sold.
d. Raw-Material Inventory, Finished-Goods Inventory, and Cost of Goods Sold.
e. Raw-Material Inventory, Work-in-Process Inventory, and Finished-Goods Inventory.
Business
1 answer:
laila [671]3 years ago
7 0

Answer:

b. Cost of Goods Sold, Work-in-Process Inventory, and Finished-Goods Inventory.

Explanation:

Whenever manufacturing overheads are prorated and under-applied or over-applied, then they are charged to inventory or cost which includes overheads as part of it.

As for instance, raw material inventory do not include any overheads, it is just the purchase price of inventory, as no work is performed on it.

Cost of goods sold, includes all the cost incurred to sale the good, from acquiring raw material to converting finished goods, and then adding the sales expense the goods are sold.

Finished goods include every material and overhead to convert the item into finished state and usable state.

Work in process is half way completed, or the percentage prescribed and includes raw material, includes overheads, but the product is somewhere more than raw inventory and less than finished good.

Therefore, correct option is:

b.

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Answer:

The attached file has the answer required.

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6 0
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Goods in process inventory account of a manufacturing company that uses an overhead rate based on the direct labor cost has a 4,
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Answer:

Overhead absorption rate

= Overhead absorbed/Actual labour cost x 100

= $4,400/$800  x 100

= 550% of direct labour cost

Explanation:

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3 years ago
Bill Pope has developed a new device that is so exciting he is considering quitting his job in order to produce and market it on
labwork [276]

Answer:

Costs of: Opportunity  Sunk Variable Fixed MOH Product Selling Differential

Garage rent  (Fixed)........................................X

Utilities  (Fixed).................................................X

Cost of the industrial design course  (Sunk) ... ''the cost has been spent''

Equipment rented .(Fixed)...............................X

Material cost  (Variable)...................X

Labor cost  (Variable).......................X

Present salary  (Opportunity cost / Differential Cost)..'He wont earn anymore'

Advertising  (Fixed and Selling Costs)............X...................................X

Explanation:

Costs of: Opportunity  Sunk Variable Fixed MOH Product Selling Differential

Garage rent  (Fixed)........................................X

Utilities  (Fixed).................................................X

Cost of the industrial design course  (Sunk) ... ''the cost has been spent''

Equipment rented .(Fixed)...............................X

Material cost  (Variable)...................X

Labor cost  (Variable).......................X

Present salary  (Opportunity cost / Differential Cost)..'He wont earn anymore'

Advertising  (Fixed and Selling Costs)............X...................................X

1. Garage rent is fixed Manufacturing Overhead because he will pay a fixed rent amount every month.

2. Utilities is fixed Manufacturing Overhead because he will pay a fixed amount every month.

3. Cost of the industrial design course  is Sunk because the cost has been spent already

4. Equipment rented  is fixed Manufacturing Overhead because he will pay a fixed amount every month.

5. Material cost  is variable because it will depend on how much produced every month.

6. Labor cost  is variable because it will depend on how much produced every month.

7. Present salary  is an Opportunity cost because wont earn salary anymore when he starts the business; this is also differential because it is the difference between the cost of the two alternative decisions

Advertising  is a fixed Selling costs because he will pay a fixed amount every month and it is related to sales not production.

4 0
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Elenna [48]
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Answer:

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hope my ans helps

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7 0
3 years ago
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