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ikadub [295]
4 years ago
10

If 120,000 units are started into production there was no beginning work in process, and40,000 units are in process at the end o

f the period, how many units were completed andtransferred out?a.120,000.b.40,000.c.80,000.d.160,000.
Business
1 answer:
Vinil7 [7]4 years ago
7 0

Answer: C - 80,000 units

Explanation:From the question above, 120,000 units started the production process without an opening balance and at the end of the period had 40,000 units left still in process. Then the balance of products completed and transferred out is:

120,000 units  minus 40,000 units in process equals to 80,000 units completed and transferred out.

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Answer:

Predetermined overhead rate=$19.5/machine hour

The company applied  $877500 to the units produced.

Explanation:

a) Pre-determined overhead rate= <u>Budgeted overhead manufacturing cost</u>

                                                         Estimated number of machine hours

                                                    =975000/50000=$19.5/machine hour.

b)Applied overhead = Pre-determined overhead rate * Actual machine hours

                               = 19.5 * 45000

                              =$877500.

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In traditional costing we use as base for calculating overhead rate is machine hours or labor hours but in activity based costing we identify activity that consume resources,identify cost driver of each activity,compute cost rate per cost driver unit and finally assign cost to products by multiplying cost driver rate.

Predetermined overhead rate= estimated overhead/Estimated base (cost driver).

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