Nakia is the production manager for WakTech. Nakia's division of WakTech focuses on wearable technology. Nakia's group
Question:
Nakia is the production manager for WakTech. Nakia's division of WakTech focuses on wearable technology. Nakia's group just finished a production job, Job SHU-001. The company allocates overhead based on direct labor dollars actually incurred. Nakia's cost accountant has presented her with the following information:
Summary of WakTech manufacturing costs | |
Budgeted manufacturing overhead costs | $ 5,408 |
Actual manufacturing overhead costs | 5,522 |
Budgeted direct manufacturing labor cost | 3,207 |
Actual direct manufacturing labor cost | 2,220 |
Information for Job SHU-001 | |
Budgeted direct materials costs | $ 694 |
Actual direct materials costs | 721 |
Budgeted direct manufacturing labor costs | 895 |
Actual direct manufacturing labor costs | 852 |
Account balances as of 12/31/2019 | ||
Accounts | Total balance (Unadjusted) | Overhead in balance (Unadjusted) |
Work-in-process | $468 | $23 |
Finished goods | 1,531 | 766 |
Cost of goods sold | 2,454 | 1,227 |
Required:
Calculate the predetermined overhead rate Nakia should apply to Job SHU-001 if she uses actual costing.
Calculate the predetermined overhead rate Nakia should apply to Job SHU-001 if she uses normal costing. Round your answer to two decimal places.nothing
Assume that WakTech uses actual costing. Using the data above, calculate the overhead applied to job SHU-001.
Assume WakTech uses actual costing. Using the data above, calculate the total manufacturing cost of job SHU-001.
1. Assume that WakTech uses normal costing. Using the data above, calculate the the amount of under-(over-) allocated overhead for the firm as a whole.
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2. Suppose instead that WakTech had used actual costing. How much would the under-(over-) allocated overhead be for the firm as a whole?
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins