Slow Steel Company is debating the use of direct labor cost or direct labor hours as the cost allocation base for allocating manufacturing overhead. The following information is available for the most recent year:

Estimated direct labor cost	$500,500
Actual direct labor cost	$465,600
Estimated manufacturing overhead costs	$385,385
Actual manufacturing overhead costs	$350,900
Estimated direct labor hours	250,600
Actual direct labor hours	232,700

If Slow Silver Company uses direct labor cost as the allocation base, compute the allocated manufacturing overhead be for the year.

Olive Company makes dessert pies for national convenient food chains. Olive Company is considering using ABC costing and has the following activity cost pools and information available:

Activities	Estimated Overhead Costs	Estimated Activity
Material handling measured by batches	$251,000	2,000 batches
Mixing measured by batches	$110,000	3,520 batches
Packaging measured by units	$84,000	2,100,000 units
Maintenance measured by # of setups	$15,000	260 setups

Olive Company currently uses a plantwide overhead rate based on total estimated machine hours of 100,000 hours.

Based on their estimates for ABC costing, compute the allocated cost for all overhead costs for Job 607 using the following information about the job.

# of units in the job = 4,900

# of units in each batch = 980

# of setups required to complete the job = 1

# of machine hours = 220

(4 marks)

Direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details include:

WIP beginning (50% for conversion)	28,400 units
Units started	124,000 units
Units completed and transferred out	107,000 units
WIP ending (50% for conversion)	45,400 units
Beginning WIP direct materials	$53,200
Beginning WIP conversion costs	$19,600
Costs of materials added	$442,100
Costs of conversion added	$304,650

(a) Compute the total equivalent units for direct materials. (2 marks)

(b) Compute the total equivalent units for conversion costs. (2 marks)

It costs Furniture's Manufacturing $0.45 to produce baseballs and Furniture sells them for $4.00 apiece. Furniture pays a sales commission of 5% of sales revenue to his sales staff. Furniture also pays $13,000 a month rent for his factory and store, and also pays $80,000 a month to his staff in addition to the commissions. Furniture sold 71,500 baseballs in June. If Furniture prepares a contribution margin income statement for the month of June, compute his operating income.

Light Me Up Lamps has variable expenses of 40% of sales and monthly fixed expenses of $240,000. The monthly target operating income is $60,000. Compute the monthly margin of safety in dollars if Light Me Up Lamps achieves its operating income goal.