Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Bridgeton Industries dropped the muffler-exhaust systems product line in the 1988 year-end. From 1988 to 1989 the both the total overhead costs and total direct

Bridgeton Industries dropped the muffler-exhaust systems product line in the 1988 year-end. From 1988 to 1989 the both the total overhead costs and total direct labor costs declined, which caused the actual overhead per direct labor to be what in 1989? (percentage or ratio/level)

Exhibit 1:

MODEL YEAR

1987

1988

1989

1990

Sales

Fuel Tanks

$70,278

$75,196

$79,816

$83,535

Manifolds

79,459

84,776

89,323

93,120

Doors

41,845

45,174

47,199

49,887

Muffler/Exhausts

62,986

66,266

0

0

Oil Pans

75,586

79,658

0

0

Total

$330,154

$351,071

$216,338

$226,542

Direct Material

Fuel Tanks

$15,125

$15,756

$16,312

$16,996

Manifolds

31,696

33,016

34,392

35,725

Doors

14,886

15,506

16,252

16,825

Muffler/Exhausts

28,440

29,525

0

0

Oil Pans

32,218

33,560

0

0

Total

$122,365

$127,363

$66,956

$69,546

Direct Labor

Fuel Tanks

$4,169

$4,238

$4,415

$4,599

Manifolds

5,886

6,027

6,278

6,540

Doors

2,621

2,731

2,844

2,963

Muffler/Exhausts

5,635

5,766

0

0

Oil Pans

6,371

6,532

0

0

Total

$24,682

$25,294

$13,537

$14,102

Overhead by Account Number

1000

$7,713

$7,806

$5,572

$5,679

1500

6,743

6,824

5,883

5,928

2000

3,642

3,794

2,031

2,115

3000

2,428

2,529

1,354

1,410

4000

8,817

8,888

7,360

7,433

5000

24,181

24,460

20,063

20,274

8000

5,964

5,946

3,744

3,744

9000

6,708

6,771

5,948

5,987

11000

5,089

5,011

3,150

3,030

12000

26,936

28,077

15,027

15,683

14000

9,733

9,784

8,025

8,110

Total

$107,954

$109,890

$78,157

$79,393

Factory Profit

$75,153

$88,524

$57,688

$63,501

Exhibit 2: Overhead Account Number

1000

Wages and benefits for nonskilled hourly personnel such as janitors and truck drivers.

1500

All plant salaried personnel expense, including benefits, except industrial engineers included in account number 11000 below.

2000

Production supplies such as gloves, safety goggles, and packing material.

3000

Small wearing tools such as grinding wheels, hammers, and screwdrivers.

4000

All purchased utilities, including coal and compressed gas.

5000

Wages for nonproduction employees with specialized skill classifications used for plant maintenance and rearrangement. The benefits associated with these wages are in class 14000 below.

8000

Depreciation on a straight-line basis and property taxes.

9000

Various relatively constant personnel-related expenses, including items such as training, travel, and union representation.

11000

Project expense for one-time setup and some rearrangement of new equipment and machinery.

12000

Benefits and overtime premium for production hourly workers, including COLA, state unemployment, and pension. Wages are in direct labor.

14000

Benefits for skilled hourly workers similar to those for production workers. Wages are in account 5000 above.

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

Computer Accounting With Peachtree Complete 2011

Authors: Carol Yacht, Peachtree Software

15th Edition

007811098X, 978-0078110986

More Books

Students also viewed these Accounting questions

Question

What do you mean by dual mode operation?

Answered: 1 week ago

Question

Explain the difference between `==` and `===` in JavaScript.

Answered: 1 week ago

Question

=+3. Who can provide information for evaluation?

Answered: 1 week ago