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kondaur [170]
3 years ago
5

Platt Company produces one product, a putter called PAR-putter. Platt uses a standard cost system and determines that it should

take one hour of direct labor to produce one PAR-putter. The normal production capacity for this putter is 100,000 units per year. The total budgeted overhead at normal capacity is $500,000 comprised of $200,000 of variable costs and $300,000 of fixed costs. Platt applies overhead on the basis of direct labor hours. During the current year, Platt produced 85,000 putters, worked 89,000 direct labor hours, and incurred variable overhead costs of $160,000 and fixed overhead costs of $300,000.
1. Compute the pre-determined variable overhead rate and the pre-determined fixed overhead rate.

Variable Overhead Rate

Fixed Overhead Rate

2. Compute the applied overhead for Platt for the year.

Applied Overhead

3. Compute the total overhead variance

Total Overhead Variance
Business
1 answer:
rodikova [14]3 years ago
3 0

Answer:

Instructions are below.

Explanation:

Giving the following information:

The normal production capacity for this putter is 100,000 units per year. The total budgeted overhead at normal capacity is $500,000 comprised of $200,000 of variable costs and $300,000 of fixed costs.

Platt produced 85,000 putters, worked 89,000 direct labor hours, and incurred variable overhead costs of $160,000 and fixed overhead costs of $300,000.

First, we need to calculate the estimated overhead rate:

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

Variable= 200,000/100,000= $2 per direct labor hour

Fixed= 300,000/100,000= $3 per direct labor hour

Total= $5

Now, we can allocate overhead:

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

Allocated MOH= 89,000*5= $445,000

Finally, the total overhead variance:

TOTAL OVERHEAD VARIANCE = Actual Factory Overhead - Standard Factory Overhead

TOTAL OVERHEAD VARIANCE= 460,000 - 445,000

TOTAL OVERHEAD VARIANCE = $15,000 unfavorable

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Answer:

a.

________________________________February__March__April

Ending inventory 20% of next Months sale _3400___3600__5,000

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b.

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Explanation:

a.

Use the following formula to calculate the Budgeted production

Budgeted Production = Beginning Inventory - Ending Inventory + Busgeted Sales

Working

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Ending inventory 20% of next Months sale _3400___3600__5,000

Less: Beginning inventory______________2,000__ 3400__ 3600

Add: Budgeted sales _________________ 13,000__17,000_ 18,000

= Budgeted production________________14,400__ 17,200_ 19,400

b.

The finished goods inventory is held to deal with the future market demand. If the firm produce the uniits equals o the current demand then in case of increase in demand or unexpected demand increase the firms will not be able to fulfil the demand and will lose the opportunity.

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he table gives the demand and supply schedules for boat rides. If the demand of boat rides increases by 40 rides a​ day, the pri
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What American business had a monopoly on the fur trade in the Far West?
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C. John Jacob Astor.

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Answer:

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Fortune, Inc., is preparing its master budget for the first quarter. The company sells a single product at a price of S25 per un
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Answer:

Instructions are below.

Explanation:

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COGS= 50,000*14= (700,000)

Gross profit= 550,000

5 0
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