Morton Companys budgeted variable manufacturing overhead is $2.50 per direct labor-hour and its budgeted fixed manufacturing overhead is $330,000 per year. The company manufactures a single product whose standard direct labor-hours per unit is 3.5 hours. The standard direct labor wage rate is $20 per hour. The standards also allow 4 feet of raw material per unit at a standard cost of $4 per foot. Although normal activity is 75,000 direct labor-hours each year, the company expects to operate at a 60,000-hour level of activity this year.

Required:

1. Assume that the company chooses 60,000 direct labor-hours as the denominator level of activity. Compute the predetermined overhead rate, breaking it down into variable and fixed cost elements.

2. Assume that the company chooses 75,000 direct labor-hours as the denominator level of activity. Compute the predetermined overhead rate, breaking it down into variable and fixed cost elements.

3. Complete two standard cost cards for 60,000 & 75,000 DLHs.

4. Assume that the company actually produces 19,000 units and works 67,000 direct labor-hours during the year. Actual manufacturing overhead costs for the year are: Variable manufacturing overhead cost $ 168,900 Fixed manufacturing overhead cost 335,600 Total manufacturing overhead cost $ 504,500

a. Compute the standard direct labor-hours allowed for this years production.

b. Complete the Manufacturing Overhead T-account below. Assume that the company uses 60,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in (1) above.

c. Assume that the company uses 60,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1).

The company manufactures a single product whose standard direct labor-hours per unit is 3.5 hours. The standard direct labor wage rate is $20 per hour. The standards also allow 4 feet of raw material per unit at a standard cost of $4 per foot. Although normal activity is 75,000 direct labor-hours each year, the company expects to operate at a 60,000-hour level of activity this year. Required: 1. Assume that the company chooses 60,000 direct labor-hours as the denominator level of activity. Compute the predetermined overhead rate, breaking it down into variable and fixed cost elements. 2. Assume that the company chooses 75,000 direct labor-hours as the denominator level of activity. Compute the predetermined overhead rate, breaking it down into variable and fixed cost elements. 3. Complete two standard cost cards for 60,000 & 75,000 DLHs. 4. Assume that the company actually produces 19,000 units and works 67,000 direct labor-hours during the year. Actual manufacturing overhead costs for the year are: Variable manufacturing overhead cost Fixed manufacturing overhead cost Total manufacturing overhead cost $ 168,900 335, 600 $ 504,500 a. Compute the standard direct labor-hours allowed for this year's production. b. Complete the Manufacturing Overhead T-account below. Assume that the company uses 60,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in (1) above. c. Assume that the company uses 60,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Req3 Req 4A Reg 4B Req 4C Complete the Manufacturing Overhead T-account below. Assume that the company uses 60,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). Actual costs Applied costs Actual costs x Manufacturing Overhead 168,900 X 532,000 335,600 X 27,500 X 0 Applied costs x