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%) E4-27 (book/static) Capitola Manufacturing produces surfboards. The company uses a normal-costing system and allocates manufacturing overhead second quarters of the year. The company is in danger of losing one of its larger customers, Pacific Wholesale, due to large fluctu and third quarters. You have been provided the following budgeted information for the coming year: BE! Click the icon to view the budgeted information.) (Click the icon to view additional information.) Read the requirements. Requirement 1 and 2. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company alla quarter and an annual budgeted manufacturing overhead rate. First identify the formula to calculate the total manufacturing cost per unit, then enter the appropriate amounts to calculate the tota each quarter and an annual budgeted manufacturing overhead rate for the year. (Abbreviation used: OH = overhead, mat.'= mater Total per ur Qtr 2 Qtr 3 Annual Question Help d on the basis of direct manufacturing labor hours. Most of the company's production and sales occur in the first and ituations in price. The owner of Capitola has requested an analysis of the manufacturing cost per unit in the second llocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each tal cost per unit for second and third quarter based on the budgeted manufacturing overhead rate determined for erials, and Var. variable.) * Data Table 1 500 Quarter 2 3 400 100 4 250 Surfboards manufactured and sold M ULINY UVOD alcu * More Info X pre It takes 2 direct manufacturing labor-hours to make each board. The actual direct material cost is $65.00 per board. The actual direct manufacturing labor rate is $20 per hour. The budgeted variable manufacturing overhead rate is $16 per direct manufacturing labor-hour. Budgeted fixed manufacturing overhead costs are $20,000 each quarter. * Requirements 2. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on an annual budgeted manufacturing overhead rate. Capitola Manufacturing prices its surfboards at manufacturing cost plus 20%. Why might Pacific Wholesale be seeing large fluctuations in the prices of boards? Which of the methods described in requirements 1 and 2 would you recommend Capitola use? Explain. 0 Help Me Solve This Question Help Splat Manufacturing produces surfboards. The company uses a normal-costing system and allocates manufacturing overhead on the basis of direct manufacturing labor hours. Most of the company's production and sales occur in the first and second quarters of the year. The company is in danger of losing one of its larger customers, Sobel Wholesale, due to large fluctuations in price. The owner of Splat has requested an analysis of the manufacturing cost per unit in the second and third quarters. You have been provided the following budgeted information for the coming year: Click the icon to view the budgeted information. (Click the icon to view additional information.) Read the requirements, Requirement 1. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter. Managers want to know manufacturing costs for ongoing uses, including pricing jobs, monitoring and managing costs, evaluating the success of the job, learning about what worked and what didn't, bidding on new jobs, and preparing interim financial statements. Because of the need for immediate access to job costs, few companies wait to allocate overhead costs until year-end when the actual manufacturing overhead is finally known. Instead, a predetermined or budgefed indirect-cost rate is calculated for each cost pool at the beginning of a fiscal year, and overhead costs are allocated to jobs as work progresses. Before determining the total cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter, you must calculate the fixed overhead by for these two quarters entering the appropriate amounts in the table. - Fixed overhead per quarter / $ 12,250 $ 12,250 Direct manufacturing labor-hour per quarter 490 245 Fixed overhead per unit S 25 Qtr 2 Qtr 3 25 = $ 50 This question is complete. Move your cursor over or tap on the red arrows to see incorrect answers. Help M 0 Data Table is. The is in dar the foll ormatio Question Help Splat Manufac basis of direct The company has requested budgeted infor E (Click the 1 565 Quarter 2 3 490 245 cturing overhead on the second quarters of the year. price. The owner of Splat h provided the following anufad ing ove Surfboards manufactured and sold 100 manu facturi Print Done Read the regul labor cost rate labor-hour per unit Direct labor per unit 28 Now enter the appropriate amounts to calculate the variable overhead per unit, this amount will not vary if calculated based on quarterly or annually. Recall that it takes 1 direct manufacturing labor-hour to make each board. Budgeted variable Direct manufacturing labor-hour per unit Variable overhead per unit manufacturing overhead rate 21 Finally enter the appropriate amounts to calculate the total cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter. (Abbreviations used: OH = overhead, mat. = materials, and Var. variable.) x pas Help Me Sol oft More Info The in dar he foll mata Question Help It takes 1 direct manufacturing labor hour to make each board. The actual direct material cost is $14.00 per board. The actual direct manufacturing labor rate is $28 per hour. The budgeted variable manufacturing overhead rate is $21 per direct manufacturing labor-hour. Budgeted fixed manufacturing overhead costs are $12,250 each quarter. Splat Manufacturing basis of direct manuf The company is in da has requested an and budgeted information (Click the icon to overhead on the quarters of the year. The owner of Splat ded the following mulad DOVE Read the requiremed Print Done + Fixed OH per unit Direct labor per unit Qtr 2 $ 28 Qir 3 $ 28 . - Direct mat per unit 14 Var. OH per unit 21 Total cost per unit $ 88 $ 113 50 Requirement 2. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on an annual budgeted manufacturing overhead rate for the year. There are two reasons for using longer periods, such as a year, to calculate indirect cost rates. First the numerator reason (indirect-cost pool). The shorter the period, the greater the influence of seasonal patterns on the amount of costs. Next the denominator reason (quantity of the cost-allocation base). Another reason for longer periods is to avoid spreading monthly fixed indirect costs over fluctuating levels of monthly output and fluctuating quantities of the cost-allocation base. Before determining the total cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on a annual budgeted manufacturing overhead rate for the year, you must calculate the annual fixed overhead per board. This question is complete. Move your cursor over or tap on the red arrows to see incorrect answers. The Help Me Solve This spany: of the ndar foll matio Question Help hufact ufad OV Splat Manufacturing produces surfboards. The company uses a normal-costing system and allocates manufacturing overhead on the basis of direct manufacturing labor hours. Most of the company's production and sales occur in the first and second quarters of the year. The com of Splat has reque ving budgeted 0 Requirements (Clich d ma Rurie Read the 1. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on an annual budgeted manufacturing overhead rate. Splat Manufacturing prices its surfboards at manufacturing cost plus 20%. Why might Sobel Wholesale be seeing large fluctuations in the prices of boards? Which of the methods described in requirements 1 and 2 would you recommend Splat use? Explain. Qtr 2 Qtr 3 s Requirer manufact pet-cost There are pool). The Print Done (quantity levels of monthly output and luctuating quantities or the cost-allocation base, pctuating Before determining the total cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on a annual budgeted manufacturing overhead rate for the year, you must calculate the annual fixed overhead per board. This question is complete. Move your cursor over or tap on the red arrows to see incorrect answers