Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

P1. Enterprises, Inc.'s principal product is a hammer that carries a lifetime guarantee. Cost and production data for the hammer follow. Direct materials: Anodized steel:

P1. Enterprises, Inc.'s principal product is a hammer that carries a lifetime guarantee. Cost and production data for the hammer follow. Direct materials: Anodized steel: 1 kilograms per hammer at $2 per kilogram Leather strapping for the handle: 0.5 square meter per hammer at $4 per square meter Direct labor: Forging operation: $24 per labor hour; 6 minutes per hammer Leather-wrapping operation: $20 per direct labor hour; 12 minutes per hammer Overhead: Forging operation: rate equals 40 percent of department's direct labor dollars Leather-wrapping operation: rate equals 60 percent of department's direct labor dollars In October, November, and December, Enterprises expects to produce 108,000, 104,000, and 100,000 hammers, respectively. The company has no beginning or ending balances of direct materials inventory or work in process inventory for the year. Required

1. For the three-month period ending December 31, prepare monthly production cost information for the hammer. Classify the costs as direct materials, direct labor, or overhead, and show your computations.

2. Prepare a cost of goods manufactured budget for the hammer. Show monthly cost data and combined totals for the quarter for each cost category.

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

Advanced Accounting

Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik

14th Edition

1260247821, 978-1260247824

More Books

Students also viewed these Accounting questions