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Please Advise!!!! 76 PROBLEM 4 Hanover Manufacturing has four categories of overhead. The four categories and expedie head costs for each category for next year
Please Advise!!!!
76 PROBLEM 4 Hanover Manufacturing has four categories of overhead. The four categories and expedie head costs for each category for next year are listed below: Maintenance... $200,000 Materials handling. 32,000 Setups. 100,000 Inspection 120,000 Currently, overhead is applied using a predetermined overhead rate based upon budgeted in labour hours. For next year, 50,000 direct labour hours are budgeted. this job would result in new business in future years. Usually bids are based upon full manufach The company has been asked to submit a bid for a proposed job. The plant manager thinks get= cost plus 20 percent Estimates for the proposed job (Job No. P902) are as follows: Direct materials........ $6,000 Direct labour (1,000 hours). $10,000 Machine hours 500 Number of material moves. 12 Number of setups 2 Number of inspections.. 10 In the past, full manufacturing cost has been calculated by allocating overhead using a volume based cost driver (direct labour hours). The plant manager has heard of a new way of appliq overhead that uses cost pools and cost drivers. Expected activity for the four activity-based cost drivers that would be used are: Machine hours 20,000 Material moves 1,600 Setups 2,500 Quality inspections 4,000 Instructions: 1. a. Determine the amount of overhead that would be allocated to the proposed lob if a plan wide rate with direct labour hours used the unit-level driver Step by Step Solution
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