Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Winder, Knotter, and Nole is a small law firm that has to partners and to support people. The firm employs a job order costing system

image text in transcribed
image text in transcribed
Winder, Knotter, and Nole is a small law firm that has to partners and to support people. The firm employs a job order costing system to accumulate couts chargeable to each client, and it is organized into two departments--the Research and Documents Department and the Ligation Department. The firm uses predetermined overhead rates to charge the costs of these departments to its clients. Al the beginning of the current year, the firm's management made the following estimates for the year Department Research and Documents 20,900 Litigation 9,450 Research-hour's Direct lewer hours materials apd supplies Direct lawyer cost Departmental overhead cost $ 19,500 $444,150 $731,50 16,900 55,900 5645,000 $330,000 The predetermined overhead rate in the Research and Documents Department is based on research hours, and the rate in the Litigation Department is based on direct towyer cost. The costs charged to each client are made up of three elements materials and supplies used, direct lawyer costs incurred, and an applied amount of overhead from each department in which work is performed on the case Case 618-3 was initiated on February 10 and completed on June 30. During this period, the following costs and time were recorded on the case: Department Research and Documents 22 Litigation Research-hours Direct lawyer-hours Materials and supplies Direct lawyer cost $60 $81 51 $ 39 $2,550 Required: 1. Compute the predetermined overhead rate used during the year in the Research and Documents Department Compute the rate used in the Litigation Department Predetermined Overhead Rate Research & Documents depuiment per hour Ligation department 2. Compute the total overhead cost applied to Case 618-3 Test odread cost 3. What is the total cost charged to Case 618-3? Show computations by department and in total for the case. Department Research Documents Litigation Total Materials and supplies Direct allomey cost Overhead cost applied Total cost $ os ols 4. At the end of the year, the firm's records revealed the following actual cost and operating data for all cases handled during the year, Department Litigation Research-hours Direct lawyer-hours Materials and supplies Direct lawyer cost Departmental overhead cost Research and Documents 23,800 8,540 $ 20,700 $427,000 $797,300 15,810 $ 6,800 $764,150 $316,200 Determine the amount of underapplied or overapplied overhead cost in each department for the year. Research & Documents department Litigation department

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

Managerial Accounting

Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer

12th Edition

978-0073526706, 9780073526706

More Books

Students also viewed these Accounting questions

Question

8.7 Evaluate at least five traditional training techniques.

Answered: 1 week ago

Question

8.5 Identify the five-step training process.

Answered: 1 week ago