Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

HELP ME Marine Components produces parts for airplanes and ships. The parts are produced to specification by their customers, who pay either a fixed price

HELP ME
image text in transcribed
image text in transcribed
image text in transcribed
Marine Components produces parts for airplanes and ships. The parts are produced to specification by their customers, who pay either a fixed price (the price does not depend directly on the cost of the job) or price equal to recorded cost plus a fixed fee (cost plus). For the upcoming year (year 2), Marine expects only two clients (client 1 and client 2). The work done for client will all be done under fixed price contracts while the work done for client 2 will all be done under cost-plus contracts The controller at Marine Components chose direct labor cost as the allocation base in year 2, based on what she considered reflected the relation between overhead and direct labor cost Year 3 is approaching and again the company only expects two clients client 1 and client 3 Work for client will continue to be billed using fixed price contracts, and client 3 will be billed based on cost-plus contracts Manufacturing overhead for year 3 is estimated to be $30 million Other budgeted data for year 3 include: Machine-hours (thousands) Direct lobor cost (5000) allent 1 6,000 56,080 Client 16.000 $6,000 Required: a. Compute the predetermined rate assuming that Marine Components uses machine hours to apply overhead b. Compute the predetermined rate assuming that Marine Components uses direct labor cost to apply overhead Required: a. Compute the predetermined rate assuming that Marine Components uses machine-hours to apply overhead. b. Compute the predetermined rate assuming that Marine Components uses direct labor cost to apply overhead Complete this question by entering your answers in the tabs below. Required A Required B Compute the predetermined rate assuming that Marine Components uses machine-hours to apply overhead. (Round your answer to 2 decimal places.) Application date per machine hour RATHER Required B > Complete this question by entering your answers in the tabs below. Required A Required B Compute the predetermined rate assuming that Marine Components uses direct labor cost to apply overhead Applicante % or direct labor cost

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

Financial Accounting

Authors: Patricia A. Libby, Daniel Short, George Kanaan, Maureen Libby Gowing, Robert Libby

4th Canadian Edition

0070001499, 9780070001497

Students also viewed these Accounting questions

Question

What is a growth firms?

Answered: 1 week ago