Question
Rasmussen Corporation expects to incur indirect overhead costs of $80,000 per month and direct manufacturing costs of $12 per unit. The expected production activity for
Rasmussen Corporation expects to incur indirect overhead costs of $80,000 per month and direct manufacturing costs of $12 per unit. The expected production activity for the first four months of 2017 is as follows:
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Required a. Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year.
b. Allocate overhead costs to each month using the overhead rate computed in Requirement a.
c. Calculate the total cost per unit for each month using the overhead allocated in Requirement b.
| Month | Jan | Feb | March | April |
| Number of Units | 6,000 | 7,000 | 3,000 | 4,000 |
| Expected Cost | ||||
| Overhead | ? | ? | ? | ? |
| Direct Cost | ? | ? | ? | ? |
| Total Cost | ||||
| Cost per unit | ? | ? | ? | ? |
January February March Aprill Estimated production In units 6,000 7,000 3,000 4,000
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Managerial Accounting An Introduction to Concepts Methods and Uses
Authors: Michael W. Maher, Clyde P. Stickney, Roman L. Weil
10th Edition
1111822239, 324639767, 9781111822231, 978-0324639766
