Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 18 (23 points) Metal Fabricating has two departments that all goods pass through: machining and assembly. Estimated data on cach department for 2020 were

image text in transcribed
image text in transcribed
Question 18 (23 points) Metal Fabricating has two departments that all goods pass through: machining and assembly. Estimated data on cach department for 2020 were as follows: Machining Budgeted Overhead S600,000 Budgeted Direct Labour Hours 10,000 Budgeted Machine Hours 50,000 Actual Overhead SS24,000 Actual Direct Labour hours 16,000 Actual Machine hours 42,000 Assembly $480,000 24,000 10,000 S500,000 28,000 6,000 Format Required: 1. Metal Fabricating currently allocates manufacturing overhead using machine hours. Compute the plant- wide overhead rates using machine hours. (2 marks) 2. Using plant-wide rate compute the amount of over-applied or under-applied manufacturing overhead for 2020.(4 marks) EQ Format BIU Font Famil Required 1. Metal Fabricating currently allocates manufacturing overhead using machine hours. Compute the plant-wide overhead rates using macl hours. (2 marks) 2. Using plant-wide rate compute the amount of over-applied or under-applied manufacturing overhead for 2020.(4 marks) 3. Management is concerned it is losing some jobs due to overpricing and incurring losses on orders. The company controller advised management the company should use departmental rates. The machining department should use machine hours as the cost driver and the assembly department should use direct labour hours as the cost driver. a Compute the departmental overhead rates. (4 marks) 6. Using departmental rates compute the amount of over-applied or under-applied manufacturing overhead for each department for 2020. marks) c. Metal Fabricating manufactured 20 shelving units for a local auto repair shop. The cost sheet contained the following information: Direct materials Direct labour Machine hours Direct labour hours Machining $10,000 $8,000 400 80 Assembly $8,000 $4,000 300 400 Compute the selling price for the auto repair shop if the markup is 40% (5 marks) I 4. Why would a company use departmental rates (2 marks)

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

Auditing CPA Exam Review

Authors: Becker

1st Edition

1943628696, 978-1943628698

More Books

Students also viewed these Accounting questions