Desert products uses a job-costing system with two direct-cost categories (direct materials and direct manufacturing labor) and one manufacturing overhead cost pool.

Desert allocates manufacturing overhead costs using direct manufacturing labor costs. Desert provides the following information:

Requirement 1. Compute the actual and budgeted manufacturing overhead rates for

2017.

(Enter your answer as a number

[not

as a percentage] rounded to two decimal places, X.XX.)

Actual manufacturing overhead rate	=
Budgeted manufacturing overhead rate	=

Requirement 2. During March, the job-cost record for Job 626 contained the following information:

	Direct materials used	$ 35 comma 000$35,000
	Direct manufacturing labor costs	$ 30 comma 000$30,000

Compute the cost of Job 626 using (a) actual costing and (b) normal costing.

	Actual
	Costing
Direct materials
Direct manufacturing labor costs
Manufacturing overhead costs
Total manufacturing costs of Job 626

Normal

Costing

Requirement 3. At the end of

20172017,

compute the under- or overallocated manufacturing overhead under normal costing. Why is there no under- or overallocated overhead under actual costing?

Under normal costing, manufacturing overhead is

by $

.

Why is there no under- or overallocated overhead under actual costing?

There is no under- or overallocated overhead under actual costing because overhead is allocated under actual costing by multiplying

actual

actual

budgeted

manufacturing labor costs and the

budgeted

actual

budgeted

manufacturing overhead rate.Requirement 4. Why might managers at

DesertDesert

Products prefer to use normal costing? (Choose all that apply.)

A.Manufacturing costs of a job are available much earlier in a normal costing system. Consequently,

DesertDesert's

manufacturing and sales managers can evaluate the profitability of different jobs, the efficiency with which the jobs are done, and the pricing of different jobs as soon as they are completed, while the experience is still fresh in everyone's mind.

B.Normal costing enables

DesertDesert

Products to use the budgeted manufacturing overhead rate determined at the beginning of the year to estimate the cost of a job as soon as the job is completed. Managers want to know job costs for ongoing uses, including pricing jobs, monitoring and managing costs, evaluating the success of the job, learning about what did and did not work, bidding on new jobs, and preparing interim financial statements.

C.

Normal costing provides managers with information earlier-while there is still time to take corrective actions, such as improving the company's labor efficiency or reducing the company's overhead costs.

D.Normal costing allows managers to allocate overhead costs at the end of the accounting year. This allows

DesertDesert

Products to use the normal costs incurred to provide an accurate costing method so that adjustments will not need to be made at the end of the accounting year.

E.

Normal costing provides managers with information at the end of a fiscal year when they know actual manufacturing overhead costs. This approach is preferable to managers to improve the company's spending efficiency and increase overall profits.

Desert Products uses a job-costing system with two direct cost categories (direct materials and direct manufacturing Desert allocates manufacturing overhead costs using direct manufacturing labor costs. Desert provides the following information: Click the icon to view the information) * Read the rest Data Table Test Requirement 1. Compute the decimal places, 30%) cu mandaduring overhea Buge mandaring over Requirement 2. During Word S Direct material costs Direct madaling labor costs Vandaduring the costs Budget for 2017 Actual Results for 2017 2.200,000 $ 2.125.000 1,450,000 1,400,000 2.537,500 2.660.000 Cartes 3026 Dired Print Done Cortina Costino Dorothy in the outfields and then continue to the next question EPIC R. T 8. Y 9 F 0 G H