Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

All the boxes highligthed jn blue are the ones needed. thanks PA2-7 (Algo) Selecting an Allocation Base and Analyzing Manufacturing Overhead [LO 2-3, 2-5] Amberjack

All the boxes highligthed jn blue are the ones needed. thanks image text in transcribed
image text in transcribed
PA2-7 (Algo) Selecting an Allocation Base and Analyzing Manufacturing Overhead [LO 2-3, 2-5] Amberjack Company is trying to decide on an allocation base to use to assign manufacturing overhead to jobs. The company has always used direct labor hours to assign manufacturing overhead to products, but it is trying to decide whether it should use a different allocation base such as direct labor dollars or mochine hours. Actual and estimated data for manufacturing overhead, direct labor cost, direct labor hours, and machine hours for the most recent fiscal year are summarized here: Required: 1. Based on the company's current allocation base (direct labor hours), compute the following: a. Predetermined overhead rate. Note: Round your answer to 2 decimal places. b. Applied manufacturing overhead. Note: Round your intermediate calculations to 2 decimal places and final answer to the nearest whole dollar amount. c. Over-or underapplied manufacturing overheod. Note: Round your intermediate calculations to 2 decimal places and final answer to the nearest whole dollar amount. 2. If the compony had used direct labor dollars (instead of direct labor hours) as its allocation base, compute the following: a. Predetermined overhead rate. Note: Round your answer to 2 decimal places, i.e. 3.63%. b. Applied manufacturing overhead Note: Round your intermediote calculations to 2 decimal places and final answer to the nearest whole dollar amount. c. Over-or underopplied manufacturing overhead. Note: Pound your intermediate calculations to 2 decimal places and final answer to the nearest whole dollar amount. 3. If the company had used machine hours (instead of direct labor hours) as its allocation bose, compute the following: a. Predetermined overhead rate. Note: Round your answer to 2 decimal places. b. Applied manufocturing overhead. Note: Round your intermediate calculations to 2 decimal places and final answer to the nearest whole dollar amount. c. Over-or underapplied manufacturing overhead. Note: Round your intermediate calculations to 2 decimal places and final answer to the nearest whole doliar amount. 4. Based on last year's data alone, which allocation base would have provided the most accurate measure for applying manufacturing overhead costs to production? \begin{tabular}{|l|l|l|} \hline 1a. Predetermined Overhead Rate & & per DLH \\ \hline 1b. Applied Manufacturing Overhead & & \\ \hline 1c. Manufacturing Overhead & & \\ \hline 2a. Predetermined Overhead Rate & & \\ \hline 2b. Applied Manufacturing Overhead & & \\ \hline 2c. Manufacturing Overhead & & \\ \hline 3a. Predetermined Overhead Rate & & \\ \hline 3b. Applied Manufacturing Overhead & & \\ \hline 3c. Manufacturing Overhead & & \\ \hline 4. Most accurate measure & & \\ \hline \end{tabular}

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction To The Study Of Auditing Fundamentals Of Auditing

Authors: Jorge Hernán Almeida Blacio, César Iván Casanova Villalba, Maybelline Jaqueline Herrera Sánchez

9th Edition

6204543512, 978-6204543512

More Books

Students also viewed these Accounting questions