Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required information [The following information applies to the questions displayed below.] Benton Corporation manufactures computer microphones, which come in two models: Standard and Premium. Data

Required information

[The following information applies to the questions displayed below.]

Benton Corporation manufactures computer microphones, which come in two models: Standard and Premium. Data for a representative quarter for the two models follow:

Standard Premium
Units produced 16,000 4,000
Production runs per quarter 50 25
Direct materials cost per unit $ 30 $ 64
Direct labor cost per unit 50 75

Manufacturing overhead in the plant has three main functions: supervision, setup labor, and incoming material inspection. Data on manufacturing overhead for a representative quarter follow:

Supervision $ 330,000
Setup labor 301,500
Incoming inspection 276,000
Total overhead $ 907,500

Required:

Benton currently applies overhead on the basis of direct labor cost. What is the predetermined overhead rate for the quarter?

The CFO and the plant controller at Benton are thinking of adopting an ABC system. They have tentatively chosen the following cost drivers: direct labor cost for supervision, production runs for setup labor, and direct material dollars for incoming inspection. Compute the cost driver rates for the proposed system at Benton.

Note: Enter your answers rounded to 2 decimal places.

a. Overhead rate % of direct labor cost
b. Supervision % of direct labor cost
b. Setup labor per production run
b. Incoming inspection % of direct material cost

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

Fraud Examination

Authors: W. Steve Albrecht, Conan C. Albrecht, Chad O. Albrecht, Mark F. Zimbelman

3rd edition

324560842, 978-0324560848

More Books

Students also viewed these Accounting questions

Question

How are over-the-counter (OTC) drugs different from prescriptions?

Answered: 1 week ago