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bonufazy [111]
3 years ago
14

A company bases its predetermined overhead rate on direct labor cost. For next year, total factory overhead cost is estimated at

$300,000 and total direct labor cost is estimated at $240,000. For the first month of the year, actual factory overhead cost was $20,000 and actual direct labor cost was $15,000. What amount of overhead will be allocated/applied/assigned to production this month?
Business
1 answer:
AlekseyPX3 years ago
3 0

Answer:

Allocated MOH= $18,750

Explanation:

Giving the following information:

The estimated total factory overhead= $300,000

Total estimated direct labor cost= $240,000.

The actual direct labor cost was $15,000.

First, we need to calculate the estimated overhead rate based on direct labor cost. Then, we can allocate overhead.

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= 300,000/240,000= $1.25 per direct labor dollar

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 1.25*15,000

Allocated MOH= $18,750

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Answer:

Re-order time 1 month

Explanation:

EOQ = \sqrt{2DS/H}

D= 450 units

S=10

H=30%

EOQ=\sqrt{2*450*10/6} = 39 units

Number of units D/EOQ = 450/39 = 12

re-order time = total period / Number of orders = 1 year /12

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5 0
3 years ago
On January 1, 2018, Olympic Insurance Company granted 30,000 stock options to certain executives. The options are exercisable no
Artyom0805 [142]

Answer:

Option D. $50,000.    

Explanation:

We can solve it by two methods:

Method 1: Conceptually

The 30,000 stock options has vested period of 3 years, which means 10,000 stock options a year. Furthermore, according to accrual concept application in the employee benefits international standard on accounting, the increase in liability for compensating other party for its services is increase in expense. Here, increase in expense is the option fair value which is $5. So the Compensation expense is:

Compensation expense = $5 per stock option * 10,000 Stock Options per year

= $50,000 for the first year 2018

Method 2: Formula Method

As we know that:

Compensation expense for 2018 = Total compensation / Vested period

Here

Total compensation = $5 stock option * 30,000 options

Vested period is 3 years

By putting values, we have:

Compensation expense = (30,000 × $5)/3 years

Compensation expense = $50,000

Don't Forget to rate my answer.

4 0
3 years ago
Golden Marine Stores Company manufactures special metallic materials and decorative fittings for luxury yachts that require high
drek231 [11]

Answer:

A. The company paid a higher cost for the direct materials than allowed by the standards.

Explanation:

The following is a logical explanation for this variance:

Since, the standard quantity of raw materials to be used is 22 pounds x 500 units = 11000 pounds. The actual usage is 9500 pounds ony. Hence, variance in direct material price variance can be only due to higher cost of direct material purchased.

7 0
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Find the average variable cost for producing 18 sneakers. Round your answer to the nearest hundredth.
murzikaleks [220]

Answer: $2.78

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Average variable cost = Variable cost of producing 18 sneakers / 18

= 50 / 18

= 2.7778

= $2.78

7 0
3 years ago
The elements in a newsletter are the title, graphics, and columns. True or false
Usimov [2.4K]
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4 0
3 years ago
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