Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose that instead of using a plantwide predetermined overhead rate, the company had used departmental predetermined overhead rates based on direct labor cost. Compute the

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Suppose that instead of using a plantwide predetermined overhead rate, the company had used departmental predetermined overhead rates based on direct labor cost. Compute the predetermined overhead rate for each department for the current year. Assume that it is customary in the industry to bid jobs at 150% of total manufacturing cost (direct materials, direct labor, and applied overhead). What was the company's bid price on the Koopers job using a plantwide predetermined overhead rate? Using the company's plantwide approach, determine the amount of manufacturing overhead cost that would have been applied to the Koopers job. Complete this question by entering your answers in the tabs below. Assume that it is customary in the industry to bid jobs at 150% of total manufacturing cost (direct materials, direct labor, and applied overhead). What would the bid price have been if departmental predetermined overhead rates had been used to apply overhead cost? Complete this question by entering your answers in the tabs below. Suppose that instead of using a plantwide predetermined overhead rate, the company had used departmental predetermined overhead rates based on direct labor cost. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job. Blast itl" said David Wilson, president of Teledex Company. "We've just lost the bid on the Koopers job by $2,000, it seems we're either too high to get the job or too low to make any money on half the jobs we bid." Teledex Company manufactures products to customers' specifications and uses a job-order costing system. The company uses a plantwide predetermined overhead rate based on direct labor cost to apply its manufacturing overhead (assumed to be all fixed) to jobs. The following estimates were made at the beginning of the year: Jobs require varying amounts of work in the three departments. The Koopers job, for example, would have required manufacturing costs in the three departments as follows: Required: a. Compute the plantwide predetermined rate for the current year. b. Determine the amount of manufacturing overhead cost that would have been appied to the Koopers job. 2. Suppose that instead of using a plantwide predetermined overhead rate, the company had used departmental predetermined overhead rates based on direct labor cost. Under these conditions: a. Compute the predetermined overhead rate for each department for the current year. b. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job 4. Assume that it is customary in the industry to bid jobs at 150% of total manufocturing cost (direct materials, direct labor, and applied ovethead)

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

Cost Accounting Fundamentals Essentials Concepts And Examples

Authors: Steven M. Bragg

7th Edition

1642210846, 978-1642210842

More Books

Students also viewed these Accounting questions

Question

L A -r- P[N]

Answered: 1 week ago

Question

=+6. What need does it fulfill?

Answered: 1 week ago

Question

=+8. How can you differentiate your product in their eyes?

Answered: 1 week ago