1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Fiesta28 [93]
3 years ago
10

Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in p

roduction (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $133,500 of manufacturing overhead for an estimated allocation base of $89,000 direct material dollars to be used in production.
The company has provided the following data for the just completed year:

Purchase of raw materials 139,000
Direct labor cost $85,000
Manufacturing overhead costs:
Indirect labor $127,800
Property taxes $8,880
Depreciation of equipment $18,000
Maintenance $12,000
Insurance $11,300
Rent, building $40,000

Beginning Ending
Raw Materials $27,000 $13,000
Work in Process $46,000 $36,000
Finished Goods $71,000 $56,000

Required:
1. Compute the predetermined overhead rate for the year.
2. Compute the amount of underapplied or overapplied overhead for the year.
3. Prepare a schedule of cost of goods manufactured for the year. Assume all raw materials are used in production as direct materials.
4. Compute the unadjusted cost of goods sold for the year. Do not include any underapplied or overapplied overhead in your answer.
Business
1 answer:
Yanka [14]3 years ago
3 0

Answer and Explanation:

According to the scenario, computation of the given data are as follow:-  

1. Predetermined Overhead Rate for a Year

= Estimated Manufacturing Overhead ÷ Estimated Allocation Base Of Direct Material × 100

= $133,500 ÷ $89,000 × 100

= 150%

2. We have a need the value of overhead applied and overhead incurred, to calculate the value of over applied and under applied overhead.

Overhead Applied = (Purchase Of Direct Material + Opening Value of Direct Material - Closing Value of Direct Material) × Predetermined Overhead Rate

= ($139,000 + $27,000 - $13,000) × 150 ÷ 100

= $153,000 × 150 ÷ 100

= $229,500

Overhead Incurred

= Indirect Labor + Property Taxes + Depreciation of Equipment + Maintenance + Insurance + Rent&Building  

= 127,800 + 8,880 + 18,000 + 12,000 + 11,300 + 40,000

= $217,980

Over Applied Overhead = Overhead Applied - Overhead Incurred

= $229,500 - $217,980

= $11,520

Overhead applied is more than overhead incurred, so this situation is called over applied overhead.

3. Cost of Goods Manufactured for the Year

Particular  Amount  ($)

Opening stock of raw material 27,000

Add-purchases of raw material 139,000

Less-closing stock of raw material 13,000

Add-Direct labor 85,000

Add-Manufacturing overhead applied to WIP 229,500

Add-Opening Work in Progress 46,000

Less-closing Work in Progress 36,000

Goods manufacturing cost 477,500

4. Unadjusted Cost of Goods Sold

Particular  Amount ($)

Goods manufacturing cost 477,500

Add-finished goods opening stock 71,000

Less-finished goods closing stock 56,000

Cost of goods sold 492,500

You might be interested in
The consumer price index is used toGroup of answer choicesturn dollar figures into meaningful measures of purchasing power.chara
jenyasd209 [6]
Im confused on what the question is
8 0
2 years ago
If the government wants to increase production of a good to achieve marginal social benefit, then the following policy will most
Kobotan [32]

Answer:

a. a subsidy so that the firm can operate where marginal social benefit equals marginal social cost.

Explanation:

The private company is producing when the marginal revenue matches the marginal cost. The governemtn will want to decrease the cost (that's by subsidize the activity) to match the marginal revenue considering the positive externalities.

The government will do a pigouvian subsidy.

The government reasons to go for this is that the good or services provide positive externalities Which are enjoy by people who doens't purchase the good. Thus, this subsidy will increase the amount of ooutput thus, generating a better social benefit.

6 0
3 years ago
Which results are more likely for someone without personal finance skills? Select three options.
KiRa [710]

Answer:

larger long-term credit or loan costs

less preparation for emergencies

increased long-term challenges

Explanation:

Personal finance involves planning and managing individual or family financial activities such as income generation, saving, spending, insurance, and investments. The process of managing personal finance is through budgeting and the development of a  financial plan.

Personal finance can be done by oneself or with the help of a personal financial manager. The objective is to help one meet both their short term and long term financial goals. Personal finance planning assists one meet expected future expenditures such as retirement while preparing them for unforeseen emergencies.

4 0
3 years ago
Read 2 more answers
Below is information from the financial statements of Greenwich Company: Accounts receivable (net) 2016: $2,400 Accounts receiva
ra1l [238]

Answer:

32.44 days

Explanation:

The computation of the average collection period is shown below:

But before that we have to determine the account receivable turnover ratio

So, the account receivable turnover ratio is

= (net sales) ÷ (average of account receivables)

= $25,875 ÷ ($2,400 + $2,200) ÷ 2

= $25,875 ÷ $2,300

= 11.25 times

Now the average collection period is

= Total no of days in a year ÷ account receivable turnover ratio

= 365 ÷ 11.25

= 32.44 days

We assume that the no of days that should be considered is 365 days

7 0
3 years ago
Racz describes a micromanager as a manager who doesn't give you a lot of breathing room. Micromanagers often stifle workers and
marusya05 [52]

Answer:

core competency

Explanation:

A core competency is a concept in management theory introduced by C. K. Prahalad and Gary Hamel. It can be defined as "a harmonized combination of multiple resources and skills that distinguish a firm in the marketplace" and therefore are the foundation of companies' competitiveness.

4 0
3 years ago
Other questions:
  • An equal partnership is formed by rita and gerry. rita contributes cash of $10,000 and a building with a fair market value of $1
    8·1 answer
  • Ali is working with a company that makes custom-designed shoes for its customers. The customers have accepted the product concep
    5·1 answer
  • Pat manages the customer care department of her firm. She is very happy with her team of 15 customer care representatives​ who'v
    10·1 answer
  • If sales are $400,000, variable costs are 75% of sales, and operating income is $40,000, what is the operating leverage
    6·1 answer
  • Workers and firms both expect that prices will be​ 2.5% higher next year than they are this year. As a​ result, A. the purchasin
    5·1 answer
  • Why does electronic commerce benefit small firms? Without e-commerce, small firms often lack the resources to expand beyond loca
    5·1 answer
  • A car dealer leases a small computer with software for $5,000 per year. As an alterative he could buy the computer for $7,500 an
    9·1 answer
  • whiche one of the following are not elements of an insurable risk a) determinable probability distribution b) calculate chance o
    6·2 answers
  • QS 20-18 (Static) Schedule of cash receipts LO P2 X-Tel budgets sales of $60,000 for April, $100,000 for May, and $80,000 for Ju
    10·1 answer
  • If the total costs of producing 1,500 units of output is $15,000 and this output sold to consumers for a total of $16,500, then
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!