Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Shaker Stairs Co.designs and builds factory-made premium wooden stairways for homes. The manufactured stairway components (spindles, risers, hangers, hand rails) permit installation of stairways of

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Shaker Stairs Co.designs and builds factory-made premium wooden stairways for homes. The manufactured stairway components (spindles, risers, hangers, hand rails) permit installation of stairways of varying lengths and widths. All are of white oak wood. Budgeted manufacturing overhead costs for the year 2020 are as follows Overhead Cost Pools Amount Purchasing $75,000 Handling materials 82.000 Production (cutting, milling, finishing) 220.000 Setting up machines 100.000 Inspecting 108.000 Inventory control raw materials and finished soods) 126.000 270.000 Total budget overhead costs 5981.000 For the Stain Cohas been charging overhead to products on the basis of machine hours. For the year 2030 100.000 machimborsare budgeted Shales Cently detectant Searer toplement the activity based At Northerior formandentify the following Activity Cost Pools Purchasing Handling materials Production (cutting, milling, finishing) Setting up machines Inspecting Inventory control raw materials and finished goods) Utilities Cost Drivers Number of orders Number of moves Direct labor hours Number of setups Number of inspections Number of components Square feet occupied Estimated Use of Cost Drivers 600 8.000 100,000 1.250 6.000 168,000 90.000 Steve Hannon, sales manager, has received an order for 250 stairways from Community Builders, Inc., a large housing development contractor. At Steve's request, Bill prepares cost estimates for producing components for 250 stairways so Steve can submit a contract price per stairway to Community Builders. He accumulates the following data for the production of 250 stairways. Direct materials $103,800 Direct labor $113,100 Machine hours 15.000 Direct labor hours 5,300 Number of purchase orders 60 Number of material moves 800 Number of machine setups Number of inspections 450 Number of components 16,000 Number of square feet occupied 8.000 100 Compute the predetermined overhead rate using traditional costing with machine hours as the basis (Round answer to 2 decimal places, eg, 12.25.) Predetermined overhead rate $ per machine hour e Textbook and Media

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_2

Step: 3

blur-text-image_3

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

International Financial Accounting And Reporting

Authors: Ciaran Connolly

2nd Edition

0903854724, 978-0903854726

More Books

Students also viewed these Accounting questions