Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Farmer's Fine Furnishing manufactures de custom furniture Farmer's currently on a plantwide vertread rate based on direct lahor hours to locate is 1.200.000 of manufacturing

image text in transcribed
image text in transcribed
image text in transcribed
Farmer's Fine Furnishing manufactures de custom furniture Farmer's currently on a plantwide vertread rate based on direct lahor hours to locate is 1.200.000 of manufacturing head to However, Desa Cem owner and CEO is considering refining the company's costing system by using department overhead rates Currently, the Machining Department 1780,000 of manufacturing that we heinishing Department in $170.000 manufacturing overhead Cermak has identified machine hour (MH) the primary maduring overhead cost driver in the Machining Department and director for houses the primary convenient Click the icon to the job information) Read the Requirement 1. Compute the plante de suming that Fame's expects to our 20.000 total hours during the you First idently the formula, the compute the rate and your new to the nearest whole dollar) Planwide overhead More Info x The Farmer's plant completed Jobs 450 and 455 on May 15. Both jobs incurred a total of 6 DL hours throughout the entire production process. Job 450 incurred 1 MH in the Machining Department and 5 DL hours in the Finishing Department (the other DL hour occurred in the Machining Department). Job 455 incurred 7 MH in the Machining Department and 4 DL hours in the Finishing Department (the other two DL hours occurred in the Machining Department). Requirements 1. Compute the plantwide overhead rate assurning that Farmer's expects to incur 20,000 total DL hours during the year. 2. Compute departmental overhead rates assuming that Farmer's expects to incur 15,600 MH in the Machining Department and 17,500 DL hours in the Finishing Department during the year. 3. If Farmer's continues to use the plantwide overhead rate, how much manufacturing overhead would be allocated to Job 450 and Job 455? 4. If Farmer's uses departmental overhead rates, how much manufacturing overhead would be allocated to Job 450 and Job 455? 5. Based on your answers to Requirements 3 and 4, does the plantwide overhead rate overcost or undercost either job? Explain. If Farmer's sells its furniture at 125% of cost, will its choice of allocation systems affect product pricing? Explain

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

Real Estate And Accounting For Beginners

Authors: Nespy Online Marketing

1st Edition

1802242880, 978-1802242881

More Books

Students also viewed these Accounting questions

Question

=+b) State the hypotheses.

Answered: 1 week ago