Needed help with 4B and 4C

2.

Morton Company's budgeted variable manufacturing overhead is $2.50 per direct labor-hour and its budgeted fixed manufacturing overhead is $450,000 per year. The company manufactures a single product whose standard direct labor-hours per unit is 2.0 hours. The standard direct labor wage rate is $16 per hour. The standards also allow 3 feet of raw material per unit at a standard cost of $4 per foot. Although normal activity is 50,000 direct labor-hours each year, the company expects to operate at a 40,000-hour level of activity this year. Required: 1. Assume that the company chooses 40,000 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 50,000 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 40,000 & 50,000 DLHS. 4. Assume that the company actually produces 21,500 units and works 46,000 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 $ 121,200 452,500 $ 573,700 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 40,000 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 40,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). Complete this question by entering your answers in the tabs below. Req 1 Req 2 Reg 3 Req 4A Reg 4B Req 4C Complete the Manufacturing Overhead T-account below. Assume that the company uses 40,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). Actual costs Standard costs Applied costs Overapplied overhead Manufacturing Overhead 121,200 591,250 452,500 17,550 X Req 1 Reg 2 Req3 Req 4A Req 4B Req 4C Assume that the company uses 40,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Variable overhead rate variance Variable overhead efficiency variance Fixed overhead budget variance Fixed overhead volume variance Overapplied overhead $ (6,200) U (7,500) U (2,500) u 33,750F $ 17,550 F Sharp Motor Company has two operating divisions-an Auto Division and a Truck Division. The company has a cafeteria that serves the employees of both divisions. The costs of operating the cafeteria are budgeted at $81,000 per month plus $0.40 per meal served. The company pays all the cost of the meals. The fixed costs of the cafeteria are determined by peak-period requirements. The Auto Division is responsible for 64% of the peak period requirements, and the Truck Division is responsible for the other 36%. For June, the Auto Division estimated it would need 89,000 meals served, and the Truck Division estimated it would need 59,000 meals served. However, due to unexpected layoffs of employees during the month, only 59,000 meals were served to the Auto Division. Another 59,000 meals were served to the Truck Division as planned. Cost records in the cafeteria show that actual fixed costs for June totaled $87,000 and actual meal costs totaled $60,200. Required: 1. How much cafeteria cost should be charged to each division for June? 2. Assume the company follows the practice of allocating all cafeteria costs incurred each month to the divisions in proportion to the number of meals served to each division during the month. On this basis, how much cost would be allocated to each division for June? (Round your intermediate calculations to 2 decimal places.) Auto Division Truck Division 1. Total cost charged 2. Total cost allocated Morton Company's budgeted variable manufacturing overhead is $2.50 per direct labor-hour and its budgeted fixed manufacturing overhead is $450,000 per year. The company manufactures a single product whose standard direct labor-hours per unit is 2.0 hours. The standard direct labor wage rate is $16 per hour. The standards also allow 3 feet of raw material per unit at a standard cost of $4 per foot. Although normal activity is 50,000 direct labor-hours each year, the company expects to operate at a 40,000-hour level of activity this year. Required: 1. Assume that the company chooses 40,000 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 50,000 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 40,000 & 50,000 DLHS. 4. Assume that the company actually produces 21,500 units and works 46,000 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 $ 121,200 452,500 $ 573,700 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 40,000 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 40,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). Complete this question by entering your answers in the tabs below. Req 1 Req 2 Reg 3 Req 4A Reg 4B Req 4C Complete the Manufacturing Overhead T-account below. Assume that the company uses 40,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). Actual costs Standard costs Applied costs Overapplied overhead Manufacturing Overhead 121,200 591,250 452,500 17,550 X Req 1 Reg 2 Req3 Req 4A Req 4B Req 4C Assume that the company uses 40,000 direct labor-hours (normal activity) as the denominator activity figure in computing predetermined overhead rates, as you have done in requirement (1). (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Variable overhead rate variance Variable overhead efficiency variance Fixed overhead budget variance Fixed overhead volume variance Overapplied overhead $ (6,200) U (7,500) U (2,500) u 33,750F $ 17,550 F Sharp Motor Company has two operating divisions-an Auto Division and a Truck Division. The company has a cafeteria that serves the employees of both divisions. The costs of operating the cafeteria are budgeted at $81,000 per month plus $0.40 per meal served. The company pays all the cost of the meals. The fixed costs of the cafeteria are determined by peak-period requirements. The Auto Division is responsible for 64% of the peak period requirements, and the Truck Division is responsible for the other 36%. For June, the Auto Division estimated it would need 89,000 meals served, and the Truck Division estimated it would need 59,000 meals served. However, due to unexpected layoffs of employees during the month, only 59,000 meals were served to the Auto Division. Another 59,000 meals were served to the Truck Division as planned. Cost records in the cafeteria show that actual fixed costs for June totaled $87,000 and actual meal costs totaled $60,200. Required: 1. How much cafeteria cost should be charged to each division for June? 2. Assume the company follows the practice of allocating all cafeteria costs incurred each month to the divisions in proportion to the number of meals served to each division during the month. On this basis, how much cost would be allocated to each division for June? (Round your intermediate calculations to 2 decimal places.) Auto Division Truck Division 1. Total cost charged 2. Total cost allocated