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finlep [7]
3 years ago
13

Kenneth Corporation expects to incur indirect overhead costs of $166,400 per month and direct manufacturing costs of $22 per uni

t. The expected production activity for the first four months of 2013 is as follows.
January February March April
Estimated production in units 4,700 8,700 4,300 7,900


Required
a.
Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year.



b.
Allocate overhead costs to each month using the overhead rate computed in Requirement a.



c.
Calculate the total cost per unit for each month using the overhead allocated in Requirement b.
Business
1 answer:
Eva8 [605]3 years ago
5 0

Explanation:

The computation is shown below:

1.  For Predetermined overhead rate

Predetermined overhead rate = (Total estimated manufacturing overhead for 4 months) ÷ (Total number of units)

where,

Total estimated direct manufacturing cost is

= $166,400 × 4 months

= $665,600

And, the total number of units is

= 4,700 units + 8,700 units + 4,300 units + 7,900 units

= 25,600 units

So, the predetermined overhead rate is

= $665,600 ÷ 25,600 units

= $26 per unit

2. Now the allocated cost for each month is shown below:

For January

= 4,700 units × $26

= $122,200

For February

= 8,700 units × $26

= $226,200

For March

= 4,300 units × $26

= $111,800

For April

= 7,900 units × $26

= $205,400

c. Now the total cost per unit is

= $22 + $26

= $48 per unit

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Answer is B

Explanation:

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So we must first calculate the Net Income for the second year using the Profit and Loss Statement format:

Year 2

Revenue                  $400,000

Less Expenses       ($220,500)

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Profit before Tax     $159,500

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Net Income              $105,270

Add Depreciation    $20,000          

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3 years ago
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5 0
3 years ago
Bud exchanges land with an adjusted basis of $ 22,000 and a fair market value of $ 30,000 for another parcel of land with a fair
erastovalidia [21]

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Solution :

This is a transaction of like kind exchange.

So, gain or loss to be recognized is :

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6 0
3 years ago
Amy is concerned with her​ organization's inability to solve problems quickly. She believes that more people should be included
Licemer1 [7]

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Explanation:

A chain of command is a system for sending inside information of organizations with strong, vertical and authoritative structures.

The continuous flow of the chain of command clearly establishes the authority, revealing this depending on who reports to whom.

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3 0
3 years ago
The following information pertains to Crane Video Company:1. Cash balance per bank, July 31, $7,263.2. July bank service charge
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Answer:

A. Prepare a bank reconciliation at July 31.

                                        Crane Video Company

                                             Bank Reconciliation

                                                        July 31

Cash balance per bank statement                             $7,263

Add: Deposits in transit                                                 1300

                                                                                      8,563

Less: Outstanding checks                                              591

Adjusted cash balance per bank                                $7,972

Cash balance per books                                             $7,284

Add: Collection of N/R ($700 plus

accrued interest $36 less collection

fee $20)                                                                          716

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Less: Bank service charge                                               28

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B. Journalize the adjusting entries at July 31 on the books of Crane Video Company.

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Jul 31         Cash                                         716

                 Miscellaneous Expense           20

                 Notes Receivable                                         700

                 Interest Revenue                                            36

(to record Collection of N/R ($700 plus accrued interest $36 less collection fee $20)

31              Miscellaneous Expense            28

                 Cash                                                                28

(to record bank service charge)

5 0
3 years ago
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