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
Flura [38]
2 years ago
10

Kunkel Company makes two products and uses a conventional costing system. A single plantwide predetermined overhead rate is comp

uted based on direct labor-hours. Data for the two products for the upcoming year follow:
Mercon Wurcon
Direct materials cost per unit $ 8.00 $ 6.00
Direct labor cost per unit $ 10.00 $ 11.00
Direct labor-hours per unit 2.00 7.00
Number of units produced 1,000 2,000
These products are customized to some degree for specific customers.
Required:
1. The company's manufacturing overhead costs for the year are expected to be $1,200,000. Using the company's conventional costing system, compute the unit product costs for the two products.
2. Management is considering an activity-based costing system in which half of the overhead would continue to be allocated on the basis of direct labor-hours and half would be allocated on the basis of engineering design time. This time is expected to be distributed as follows during the upcoming year:
Mercon Wurcon Total
Engineering design time (in hours) 1,000 1,000 2,000
Compute the unit product cost for the two products using the proposed ABC system. (Do not round intermediate calculation. Round your final answers to 2 decimal places.)
Mercon Wurcon
Unit product cost
Business
1 answer:
Ilia_Sergeevich [38]2 years ago
3 0

Answer:

Results are below.

Explanation:

<u>First, we need to calculate the predetermined overhead rate:</u>

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

Total number of direct labor hours= (1,000*2) + (2,000*7)= 16,000

Predetermined manufacturing overhead rate= 1,200,000 / 16,000

Predetermined manufacturing overhead rate= $75 per direct labor hour

<u>Now, we allocate overhead to each unit and calculate the unitary cost:</u>

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

Mercon:

Allocated MOH= 75*2= $150

Unitary cost= 150 + 8 + 10= $168

Wurcon:

Allocated MOH= 75*7= $525

Unitary cost= 525 + 6 + 11= $542

<u>Finally, using activity-based costing:</u>

Mercon Wurcon Total

Engineering design time (in hours) 1,000 1,000 2,000

Direct labor-hours 2,000 14,000 16,000

Engineering= 600,000 / 2,000= $300 per design hour

Direct labor= 600,000 / 16,000= $37.5 per direct labor hour

Mercon:

Allocated MOH= 37.5*2 + 300*1= $375

Unitary cost= 375 + 8 + 10= $393

Wurcon:

Allocated MOH= 37.5*7 + 300*0.5= $412.5

Unitary cost= 412.5 + 6 + 11= $429.5

You might be interested in
5. Score Skateboard Company is a small firm that designs and manufactures skateboards for high school and college students who w
Marianna [84]

Answer:

(a) Cost to Score for an employee with $1,100.00 gross pay is $1,175.00.

(b) Cost to Score for an employee with $850.00 gross pay is $925.00.

(c) Total gross semimonthly pay for all six employees is $6,050.

Explanation:

The questions can be answered as follows:

a. Calculate the cost to Score for an employee with $1,100.00 gross pay in the first pay period in January.

This can be calculated as follows:

Cost to Score for an employee with $1,100.00 gross pay = Gross pay + Contribution to retirement fund = $1,100.00 + $75.00 = $1,175.00

b. Calculate the cost to Score for an employee with $850.00 gross pay in the first pay period in January.

This can be calculated as follows:

Cost to Score for an employee with $850.00 gross pay = Gross pay + Contribution to retirement fund = $850.00 + $75.00 = $925.00

c. Calculate the total gross semimonthly pay for all six employees.

This can be calculated as follows:

Cost to Score for 2 employee with $1,100.00 gross pay = $1,175.00 * 2 = $2,350

Cost to Score for 4 employee with $850.00 gross pay = $925.00 * 4 = $3,700

Total gross semimonthly pay for all six employees = Cost to Score for 2 employee with $1,100.00 gross pay + Cost to Score for 4 employee with $850.00 gross pay = $2,350 + $3,700 = $6,050

8 0
2 years ago
An employee has​ year-to-date earnings of . The​ employee's gross pay for the next pay period is . If the FICAOASDI is ​% and th
taurus [48]

Answer:

$192

Explanation:

Calculation for how much FICA-OASDI tax will be withheld from the employee's pay?

FICA-OASDI tax=($117,000-$113,900)*6.2%

FICA-OASDI tax=$3,100*6.2%

FICA-OASDI tax=$192

Therefore how much FICA-OASDI tax will be withheld from the employee's pay is $192

5 0
2 years ago
Pretax accounting income for the year ended December 31, 2021, was $42 million for Truffles Company. Truffles' taxable income wa
Zielflug [23.3K]

Answer:

$13million

Explanation:

7 0
3 years ago
Read 2 more answers
Blanco Company purchased 200 of the 1,000 outstanding shares of Darby Company's common stock for $600,000 on January 2, 2018. Du
Kisachek [45]

Answer:

The answer is c. $600,000

good luck ❤

7 0
3 years ago
The market risk, beta, of a security is equal to Group of answer choices the variance of the security's returns divided by the c
GaryK [48]

Answer:

the covariance between the security's return and the market return divided by the variance of the market's returns

Explanation:

The market risk, beta of the security would be equivalent to the

Beta = Cov(rm, rs) ÷  Var(rm)

Rm denotes  market return

rs denotes security return

Cov denotes covariance

Var denotes variance

Hence, the second option is correct

And, the rest of the options are wrong

3 0
3 years ago
Other questions:
  • Kristina is working at a job that she finds boring and unmotivating. one day she initiates a search for a new job. what kind of
    5·2 answers
  • Environmental sustainability is ensuring that our natural resources can be used
    7·1 answer
  • The Supply/Demand equilibrium price is __________ with an equilibrium quantity of _________. PRICE Column 1 Quantity Column 2 Qu
    12·1 answer
  • QUESTION 2
    15·1 answer
  • A company shows a $600 balance in Prepaid Insurance in the Unadjusted Trial Balance columns of the work sheet. The Adjustments c
    10·1 answer
  • A paint manufacturing company has three factories located in France, Germany, and Spain. The productivity data of the factories
    5·1 answer
  • . Determine the receivables turnover ratio and average days sales in receivables for the current year. (Use 365 days a year. Do
    7·1 answer
  • Discuss the priority of charges whenever a company needs to pay off all of its creditors’ debts
    15·1 answer
  • Why might some investors become careless about their portfolios ?
    15·1 answer
  • Journalize the entries to correct the following errors:
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!