1 Mc Graw Exercise 2-13 (Static) Departmental Predetermined Overhead Rates [LO2-1, LO2-2, LO2-4] White Company has two departments, Cutting and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each department. The Cutting Department bases its rate on machine-hours, and the Finishing Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates: Department Direct labor-hours Machine-hours Total fixed manufacturing overbead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Direct labor-hours Machine-hours Direct materials Direct labor cost Required: 1. Compute the predetermined overhead rate for each department. 2. The job cost sheet for Job 203, which was started and completed during the year, showed the following: Department Cutting 6 NO $ 500 $ 108 Required 1 Finishing 20 4 Cutting 6,000 48,000 $ 264,000 $ 2.00 $ 310 $360 Required 2 Required 3 Finishing 30,000 5,000 $365,000 $ 4.00 Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to Job 203. 3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide predetermined overhead rate based on direct labor-hours, rather than using departmental rates? Complete this question by entering your answers in the tabs below.
1 Mc Graw Exercise 2-13 (Static) Departmental Predetermined Overhead Rates [LO2-1, LO2-2, LO2-4] White Company has two departments, Cutting and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each department. The Cutting Department bases its rate on machine-hours, and the Finishing Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates: Department Direct labor-hours Machine-hours Total fixed manufacturing overbead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour Direct labor-hours Machine-hours Direct materials Direct labor cost Required: 1. Compute the predetermined overhead rate for each department. 2. The job cost sheet for Job 203, which was started and completed during the year, showed the following: Department Cutting 6 NO $ 500 $ 108 Required 1 Finishing 20 4 Cutting 6,000 48,000 $ 264,000 $ 2.00 $ 310 $360 Required 2 Required 3 Finishing 30,000 5,000 $365,000 $ 4.00 Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to Job 203. 3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide predetermined overhead rate based on direct labor-hours, rather than using departmental rates? Complete this question by entering your answers in the tabs below.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 21E: Refer to the data in Exercise 7.20. The company has decided to use the sequential method of...
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Transcribed Image Text:Machine-hours
Direct materials
Direct labor cost
80
$500
$ 108
Using the predetermined overhead rates that you computed in requirement (1), co
203.
3. Would you expect substantially different amounts of overhead cost to be assigne
predetermined overhead rate based on direct labor-hours, rather than using depan
Complete this question by entering your answers in the tabs below.
Predetermined overhead rate
4
$ 310
$360
Required 1 Required 2
Compute the predetermined overhead rate for each department. (Round your answers to
Cutting Department
per MH
Finishing Department
per DLH
Required 3
Required 1 Required 2 Required 3
(Required 1
Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assi
203.
3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a
predetermined overhead rate based on direct labor-hours, rather than using departmental rates?
Complete this question by entering your answers in the tabs below.
< Required 1
Required 2 >
Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost
assigned to Job 203. (Round intermediate calculations to 2 decimal places and final answer to the nearest dollar amount.)
Total manufacturing cost
Required 3 >
![1
Mc
Graw
Exercise 2-13 (Static) Departmental Predetermined Overhead Rates [LO2-1, LO2-2, LO2-4]
White Company has two departments, Cutting and Finishing. The company uses a job-order costing system and computes a
predetermined overhead rate in each department. The Cutting Department bases its rate on machine-hours, and the Finishing
Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates:
Department
Direct labor-hours
Machine-houre
Total fixed manufacturing overhead coat
Variable manufacturing overhead per machine-hour
Variable manufacturing overhead per direct labor-hour
Direct labor-hours
Machine-hours
Direct materials
Direct labor cost
Required:
1. Compute the predetermined overhead rate for each department.
2. The job cost sheet for Job 203, which was started and completed during the year, showed the following:
Department
Cutting
Required 1
6
NO
$ 500
$ 108
Cutting
6,000
48,000
$ 264,000
$ 2.00
Finishing
20
4
$310
$360
Finishing
30,000
5,000
$365,000
Required 2 Required 3
$4.00
Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to Job
203.
3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide
predetermined overhead rate based on direct labor-hours, rather than using departmental rates?
Complete this question by entering your answers in the tabs below.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F567e5c76-a71a-4e3b-b67f-acaa9766611e%2F0425f5f0-9d88-48c8-91e2-59c8d6c1fa2d%2Fnlhldqm_processed.jpeg&w=3840&q=75)
Transcribed Image Text:1
Mc
Graw
Exercise 2-13 (Static) Departmental Predetermined Overhead Rates [LO2-1, LO2-2, LO2-4]
White Company has two departments, Cutting and Finishing. The company uses a job-order costing system and computes a
predetermined overhead rate in each department. The Cutting Department bases its rate on machine-hours, and the Finishing
Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates:
Department
Direct labor-hours
Machine-houre
Total fixed manufacturing overhead coat
Variable manufacturing overhead per machine-hour
Variable manufacturing overhead per direct labor-hour
Direct labor-hours
Machine-hours
Direct materials
Direct labor cost
Required:
1. Compute the predetermined overhead rate for each department.
2. The job cost sheet for Job 203, which was started and completed during the year, showed the following:
Department
Cutting
Required 1
6
NO
$ 500
$ 108
Cutting
6,000
48,000
$ 264,000
$ 2.00
Finishing
20
4
$310
$360
Finishing
30,000
5,000
$365,000
Required 2 Required 3
$4.00
Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to Job
203.
3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide
predetermined overhead rate based on direct labor-hours, rather than using departmental rates?
Complete this question by entering your answers in the tabs below.
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