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allochka39001 [22]
2 years ago
13

Characteristics of Production Process, Cost Measurement Vince Melders, of EcoScape Company, designs and installs custom lawn and

garden irrigation systems for homes and businesses throughout the state. Each job is different, requiring different materials and labor for installing the systems. EcoScape estimated the following for the year: Number of direct labor hours 6,990 Direct labor cost $69,900 Overhead cost $50,328 During the year, the following actual amounts were experienced: Number of direct labor hours 6,050 Direct labor incurred $66,550 Overhead incurred $48,043.05 Required: 1. Should EcoScape use process costing or job-order costing? Job-order costing 2. If EcoScape uses a normal costing system and overhead is applied on the basis of direct labor hours, What is the overhead rate? Round your answer to the nearest cent. $ 7.2 per direct labor hour What is the average actual wage rate? $ 7.94 per direct labor hour What is the cost of an installation that takes $3,540 of direct materials and 30 direct labor hours? $
Business
1 answer:
Ugo [173]2 years ago
5 0

Answer:

1) Job-order costing

2)$ 7.2 per direct labor hour

3)$ 7.941 per direct labor hour

4)Cost of installation= $ 4108.23

Explanation:

In job order costing the cost accounting procedures are designed to assign costs to each job. Then the costs assigned to each job are averaged over the units of production in the job to obtain an average cost per unit.

A process costing system accumulates all production costs for a large number of units of outputs and then these costs are averaged over all the units.

1) As each job is different, requiring different materials and labor for installing the systems Job-order costing will be used.

2) If normal costing is used then the  Overhead cost are $50,328

Number of direct labor hours are 6,990

The overhead rate=Overhead costs/ Number of direct labor hours

The overhead rate=$50,328/6,990= $ 7.2 per direct labor hour

3) The average actual wage rate = Actual Overhead costs / Number of direct labor hours

The average actual wage rate = $48,043.05/ 6,050=$ 7.941 per direct labor hour

4) Direct materials=$3,540

Direct labor hours= 30

Actual Direct Labor rate =  ($66,550/6,050 )= $ 11

Direct Labor = ($66,550/6,050 )*30 =11*30=$ 330

Overheads 30 *7.941= $ 238.23

Cost of installation= $3,540 +$ 330+$ 238.23= $ 4108.23

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Bluestone Company had three intangible assets at the end of the current year:
adoni [48]

Answer and Explanation:

The computation is shown below:

1) Calculation of the acquisition cost is

Patent = $4,000

Trademark = $210,000 + $8,500 = $218,500

Licensing Rights = $80,000

2) Computation the amortization expense is  

Patent = $4,000 ÷ 10 = $400

Trademark = $218,500 ÷ 10 = $21,850

Here we assume the indefinite life of 10 years  

Licensing Rights = $80,000 ÷ 5 = $16,000

3)

Income statement:

Amortization expense  $38,250 ($400 + $21,850 + $16,000)

Balance sheet at year end december:

Fixed assets

Intangibles

Patent         $3600 ($4,000 - $400)

Trademark  $196,650 ($218,500 - $21,850)

Licensing Rights  $64,000 ($80,000 - $64,000)

8 0
2 years ago
On October 31, Legacy Rocks Inc., a marble contractor, issued for cash 400,000 shares of $10 par common stock at $18, and on Nov
ivann1987 [24]

Answer: The answer is as follows:

Explanation:

Journal entries are as follows:

For October 31:

Cash  (400,000 × $18)                   $7,200,000

Common stock  (400,000 × $10)                                          $4,000,000

Paid in capital in excess of par value-common stock         $3,200,000

( record of issuing common stock)

For November 19:

Cash  (50,000 × $80)                    $4,000,000  

Preferred stock (50,000 × $75)                                             $3,750,000

Paid in capital in excess of par value-Preferred stock        $250,000

( record of issuing preferred stock)

8 0
3 years ago
The production department of Priston Company has submitted the following forecast of units to be produced by quarter for the upc
Levart [38]

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

1st Quarter -  2nd Quarter - 3rd Quarter - 4th Quarter

Units to be produced: 6,000 - 7,000 - 8,000 - 5,000

the beginning raw materials inventory= 3,600

Each unit requires three pounds of raw material that costs $2.50 per pound. Management desires to end each quarter with a raw materials inventory equal to 20% of the following quarter

I will assume that the requirements are the cost of direct material for each quarter.

<u />

<u>The direct material budget is calculated by the following formula:</u>

Direct material budget= direct material for production + ending inventory - beginning inventory

Q1:

Production= (6,000*3)*$2.5= $45,000

Ending inventory= [(7,000*3)*$2.5]*0.20= $10,500

Beginning inventory= (3,600*2.5)= (9,000)

Total= $46,500

Q2:

Production= (7,000*3)*$2.5= $52,500

Ending inventory= [(8,000*3)*$2.5]*0.20= $12,000

Beginning inventory= (10,500)

Total= $54,000

Q3:

Production= (8,000*3)*$2.5= $60,000

Ending inventory= [(5,000*3)*$2.5]*0.20= $7,500

Beginning inventory= (12,000)

Total= $55,500

8 0
3 years ago
Amanda looked up at the scoreboard and exclaimed, "Wow, that is so vivid and fantastic. I don't know what that cost, but it is a
Neko [114]

Answer:

Electronic equipment

Explanation:

Throughout history, sport has evolved while society has done it. Both at a professional or elite level and at an amateur level, the sport has undergone several revolutions, some of them due to technological inventions.

There is no sport that has not undergone a technological revolution, one way or another. Some, like basketball, have been more prone in this regard, while others have been sidelined. But without a doubt, nobody escapes the tentacles of innovation.

Technology in sports has been included to apply its rules more easily, be more objective, and improve the accuracy of the sport. They are tools that facilitate the practice of sport.

3 0
2 years ago
Booker Corporation had the following comparative current assets and current liabilities: Dec. 31, 2017 Dec. 31, 2016 Current ass
stiks02 [169]

Answer:

Liquidity measures for the year 2017 are as under:

Current Ratio = 1.5  

Working Capital = $100,000  

Acid Test Ratio = 0.95  

Accounts Receivables Turnover = 10 times  

Inventory turn over = 4 times  

Explanation:

<u>Current Ratio</u>

        Current Ratio = Current Assets ÷ Current Liabilities

                          <u>Dec 31, 2017</u>                                     <u>Dec 31, 2016 </u>

                      $300,000 ÷ $200,000                   $245,000  ÷ $155,000  

Current Ratio                 1.5                                                  1.6  

<u>Working Capital</u>  

       Working Capital = Current Assets – Current Liabilities

                          <u>Dec 31, 2017</u>                                     <u>Dec 31, 2016 </u>

                      $300,000 – $200,000                   $245,000  – $155,000

Working Capital         $100,000                                     $90,000  

 

<u>Acid Test Ratio</u>

        Acid Test Ratio = (Current Assets – Inventory)  ÷ Current Liabilities

                          <u>Dec 31, 2017</u>                                     <u>Dec 31, 2016</u>

($300,000 – $110,000) ÷ $200,000     ($245,000 – $90,000) ÷ $155,000

Acid Test Ratio           0.95                                                1.00  

 

<u>Accounts Receivables Turnover Times</u>  

Accounts Receivables Turnover = Credit Sales ÷ Average Accounts Receivables

Average Accounts Receivables = (Opening Accounts Receivables + Closing Accounts Receivables) ÷ 2

Average Accounts Receivables = ($55,000 + $95,000) ÷ 2 = $75,000

Accounts Receivables Turnover = $750,000  ÷ $75,000 = 10 Times

<u>Inventory Turnover Times</u>

Inventory Turnover = Cost of Goods Sold ÷ Average Inventory

Average Inventory = (Opening Inventory + Closing Inventory)  ÷ 2

Average Inventory =  ($110,000 + $90,000)  ÷ 2 = $100,000

Inventory Turnover =  $400,000  ÷ $100,000 = 4 Times

 

5 0
3 years ago
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