Sunny Corp. manufactures portable beds and chairs made of round steel bars and woven plastic strips...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Sunny Corp. manufactures portable beds and chairs made of round steel bars and woven plastic strips (similar to woven rattan strips). The steel bars are cut, heated and bent before they are connected by bolts and nuts to form the desired structures. The woven plastic strips are subsequently attached per specifications. For 2014, estimated factory overhead (without the corresponding provision for any imperfection) is P 60,000 based on estimated direct labor cost of P 120,000. Per estimates, a 5% spoilage may be expected with unrecovered cost of P 3,000. For January, 2014, the company processed an order for 10 portable rocking chairs (job no. 027). The prime costs are as follows: P 10,000 5,000 Direct materials Direct labor Upon final inspection, two rocking chairs are found below standard. Estimated cost recovery is P 1,000 per chair. Questions: a. Assuming that the job is a regular or standard one, (1) what factory overhead rate must be used? (2) what must be the unit cost for the remaining eight rocking chairs upon completion? (3) what are the entries to take up the original production cost, spoilage and completion of the remaining units? b. Assuming that the job is a special one, what would be your answers for the questions given above? Sunny Corp. manufactures portable beds and chairs made of round steel bars and woven plastic strips (similar to woven rattan strips). The steel bars are cut, heated and bent before they are connected by bolts and nuts to form the desired structures. The woven plastic strips are subsequently attached per specifications. For 2014, estimated factory overhead (without the corresponding provision for any imperfection) is P 60,000 based on estimated direct labor cost of P 120,000. Per estimates, a 5% spoilage may be expected with unrecovered cost of P 3,000. For January, 2014, the company processed an order for 10 portable rocking chairs (job no. 027). The prime costs are as follows: P 10,000 5,000 Direct materials Direct labor Upon final inspection, two rocking chairs are found below standard. Estimated cost recovery is P 1,000 per chair. Questions: a. Assuming that the job is a regular or standard one, (1) what factory overhead rate must be used? (2) what must be the unit cost for the remaining eight rocking chairs upon completion? (3) what are the entries to take up the original production cost, spoilage and completion of the remaining units? b. Assuming that the job is a special one, what would be your answers for the questions given above?
Expert Answer:
Answer rating: 100% (QA)
Answer a 1 Overhead rate P050 2 P1875 3 See journal entries in explanation b 1 Overhead rate P050 2 ... View the full answer
Related Book For
Principles of Accounting
ISBN: 978-1133626985
12th edition
Authors: Belverd E. Needles, Marian Powers and Susan V. Crosson
Posted Date:
Students also viewed these accounting questions
-
Blackmun Corp signed a 3 year non-cancelable lease for certain machinery on Dec 31, 2018. The terms of the lease called for Blackmun Corp to make equal annual payments of $15600 at the end of each...
-
? Raw materials Work in process Finished goods $ 84,500 $ 35,000 $ 44,100 The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the company's...
-
The unadjusted trial balance for Sierra Corp. is shown below. SIERRA CORPORATION Trial Balance October 31, 2014 Debit Credit Cash $15,310 Supplies 3,440 Prepaid Insurance 714 Equipment 4,730 Notes...
-
Peete's Coffee and Tea purchased equipment on March 1, 2022 for $17,400. It is estimated that the equipment will have a $300 salvage value at the end of its 6 -year useful life. It is also estimated...
-
The Excel file Investment Returns provides sample data for the annual return of the S& P 500, and monthly returns of a stock portfolio and bond portfolio. Construct histograms for each data set and...
-
The marketing research department at PepsiCo plans a national survey of 2,500 teenagers regarding a newly developed soft drink. Each teenager will be asked to compare it with his or her favorite soft...
-
Chica's Inc. sold a \(\$ 50\) gift card on February 1, 2020. The gift card was redeemed on February 14, 2020. Record the entries on (1) February 1 and (2) February 14 for Chica's Inc.
-
Following are the auditor's calculations of several key ratios for Cragston Star Products. The primary purpose of this information is to understand the client's business and assess the risk of...
-
Wildhorse Top uses the periodic inventory system. For thecurrent month, the beginning inventory consisted of 486 units thatcost $67 each. During the month, the company made two purchases:723 units 2...
-
Dr Jannie Chan Siew Lee is the founder of the Asia-Pacific-based watch retailer The Hour Glass. The business was created in 1979, and Jannie served as the company's managing director from...
-
What is the state of the marketplace for productivity application suites? How would you describe the current development process and organization? What are the challenges of integrating individual...
-
1.A nurse is listening to a lecture on self-awareness. Which statement by the nurse indicates that the teaching has been effective? a.Self-confidence involves knowing oneself. b.Competence involves...
-
What idea, concept or issue stood out to you in Antikickback statute If you are to be a health services manager, how might you use or apply Antikickback statute information in your work? List and...
-
Use your completed Venn diagram to answer this question: What are the characteristics of monopolistic competition and oligopoly? 2. Extension You want to buy a new pair of jeans. The store offers...
-
An electrician charges $62.50 per hour plus a one-time fee of $29.95. The electrician charged a customer $404.95. How many hours did the electrician charge the customer for?
-
30. Figure shows two plane mirrors parallel to each other and an object O placed between them. Then the distance of the first three images from the mirror M2 will be: (in cm) 5cm 15cm M (1) 5, 10, 15...
-
Submit a draft of your memos to upper management. First, you will prepare a memo to be reviewed by the chief financial officer (CFO) of your chosen company that summarizes the audit process...
-
Evenflow Power Co. is considering a new project that is a little riskier than the current operations of the company. Thus, management has decided to add an additional 1.5% to the company's overall...
-
Meloon Lawn Supply Company uses a multicolumn purchases journal and a general journal similar to those illustrated in the text. The company also maintains an accounts payable subsidiary ledger. The...
-
On February 15, Mite Corporations board of directors declared a 2 percent stock dividend applicable to the outstanding shares of its $10 par value common stock , of which 400,000 shares are...
-
Party Balloons Company produces mylar balloons. The companys direct materials standards for its deluxe balloon include 3 ounces of mylar. Standard prices for the year were $0.030 per ounce. Direct...
-
What is meant by alter ego?
-
Find the Internet site "Bob Jensen's Enron Quiz Questions." Take the Quiz.
-
On the Internet, find the SEC Staff Accounting Bulletin No. 101. What are the criteria for determining if revenue is realized or realizable and earned?
Study smarter with the SolutionInn App