Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

help me with question one pls, full information. Question 1 (June 2012 Normal) A factory with three departments uses a single production overhead absorption rate,

image text in transcribed

help me with question one pls, full information.

Question 1 (June 2012 Normal) A factory with three departments uses a single production overhead absorption rate, expressed as a percentage of direct wages cost. It has been suggested that departmental overhead absorption rates would result in more accuratejo costs. Set out below are budgeted and actual data for the previous period, together with information relating to job no. 657. Direct wages Direct our Machine hours Production hours overheads Budget: Department N$ 25 000 10 000 40 000 N$ 120 000 B 100 000 50 000 10 000 30 000 c 25 000 25 000 75 000 Total: 150 000 85 000 50 000 225 000 Actual Department A NS 30 000 12 000 45 000 N$ 130 000 B 80 000 45 000 14 000 28 000 30 000 30 000 80 000 Total: 140 000 87 000 59 000 238 000 . . During this period job no. 657 incurred the actual costs and actual times in the departments as show below Direct Material Direct wagos Direct Machine labour NS NS hours Hours Department 120 100 20 40 B 60 60 40 10 10 10 10 After adding production overhead to prime cost, one-third of total cost is added to production cost for gross profit. You are required to calculate the current overhead absorption rate (2 Marks) 1.2 using the rate obtained in 4.1 above, calculate the production overhead charged to job no 657 and state the production cost and expected gross profit on this job. (5 Marks) 1.3 Compute departmental overhead absorption rates, using machine hours as basis for department A, and labour hours as basis for department B and C (6 Marks) Use the departmental overhead absorption rates and calculate the production overheads charged to job no. 657. (2 Marks) 1.5 Show the over-/under-absorption, by department and in total, for the period using the rates calculated in 4.3 as basis for allocating the overheads

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_2

Step: 3

blur-text-image_3

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

Statutory Audits In Europe

Authors: Michael Kend, Giulia Leoni, Cristina Florio, Silvia Gaia

1st Edition

1032201738, 978-1032201733

More Books

Students also viewed these Accounting questions

Question

Writing a Strong Introduction

Answered: 1 week ago