Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Kingsport Containers Company makes a single product with wide seasonal variations in demand. The company uses a job-order costing system and computes plantwide predetermined overhead

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Kingsport Containers Company makes a single product with wide seasonal variations in demand. The company uses a job-order costing system and computes plantwide predetermined overhead rates on a quarterly basis using the number of units to be produced as the allocation base. Its estimated costs, by quarter, for the coming year are given below: Management finds the variation in quarterly unit product costs to be confusing. Accordingly, you have been asked to find a more appropriate way of applying manufacturing overhead cost to units of product. Required: 1. Assuming the estimated variable manufacturing overhead cost per unit is $0.30, what must be the estimated total fixed manufacturing overhead cost per quarter? 2. Assuming the assumptions about cost behavior from the first three quarters hold constant, what is the estimated unit product cost for the fourth quarter? 3. What is causing the estimated unit product cost to fluctuate from one quarter to the next? 4. Assuming the company computes one predetermined overhead rate for the year rather than computing quarterly overhead rates, calculate the unit product cost for all units produced during the year. Complete this question by entering your answers in the tabs below. Assuming the estimated variable manufacturing overhead cost per unit is $0.30, what must be the estimated total fixed manufacturing overhead cost per quarter? Complete this question by entering your answers in the tabs below. Assuming the company computes one predetermined overhead rate for the year rather than computing quarterity overhead rates, calculate the unit product cost for all units produced during the vear. Note: Do not round intermediate calculations and round your fingl answer to 2 decimal places. Complete this question by entering your answers in the tabs below. What is causing the estimated unit product cost to fluctuate from one quarter to the next? Complete this question by entering your answers in the tabs below. Assuming the assumptions about cost behwior from the first three quarters hold constant, what is the estimated unit product cost for the fourth quarter? Note: Do not round intermediate calculations and round the "Unit product cost" to 2 decimal places

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

The Internal Auditing Pocket Guide

Authors: J. P. Russell

1st Edition

0873895606, 978-0873895606

More Books

Students also viewed these Accounting questions