Solution-1nbspnbspnbspnbspnbsp ernest inc has identified

1nbspnbspnbspnbspnbsp ernest inc has identified the

Assignment Help Managerial Accounting

Reference no: EM13346560


1. Ernest, Inc. has identified the following overhead costs and cost drivers for next year:
Overhead Item	Expected Cost	Cost Driver	Quantity	Activity rate
Setup costs	$320,000	Number of setups	4,000
Ordering costs	120,000	Number of orders	15,000
Maintenance	480,000	Machine hours	125,000
Power	40,000	Kilowatt hours	200,000
Total overhead	$960,000

The following are two of the jobs completed during the year:
	Job 320	Job 321
Direct materials	$ 19,200	$ 24,000		Overhead costs
Direct labor	$ 24,000	$ 30,000		Job 320	Job 321
			Setup costs
Units completed	1,600	2,000	Ordering costs
			Maintenance
Number of setups	12	10	Power
Number of orders	20	30	Total	-	-
Machine hours	400	600
Kilowatt hours	280	350

Required:
1. Complete the schedule above to compute the pool rates for the different activities.
2a. Compute the total job costs assigned to the each of the two jobs using the information provided. Assign overhead using the pool rates calculated in "a" above.
	Job 320	Job 321
Direct materials
Direct labor
Overhead costs
Total costs assigned

2b. Compute the unit cost for the two jobs.
Total Costs Assigned	-	-
Number of Units	1,600	2,000
Cost Per Unit	$ -	$ -

3. Assume instead of using ABC costing, the company used a traditional costing method that assigns overhead using a predetermined rate based on machine hours. Based on the original numbers, total overhead for the year is $960,000 and the total estimated machine hours are 125,000.
a. Compute the predetermined rate using the information in item 3.
	960,000.00
	125,000.00
b. Compute the total cost assigned to jobs 320 and 321 by substituting the traditional overhead for the ABC overhead that you computed in 2 above
Overhead assigned	Hours	Rate	Total
Job 320	400
Job 321	600

	Job 320	Job 321
Direct materials
Direct labor
Overhead costs
Total costs assigned	-	-

Reference no: EM13346560

Questions Cloud

In one of your initial meetings with the ceo she asked you : in one of your initial meetings with the ceo she asked you to identify a number of the typical criteria used when

Task 1go to httppricespyconz httpwwwbuildtoorderpccom or : task 1go to httppricespy.co.nz httpwww.buildtoorderpc.com or any another source that identifies the cost of computer

Problem 1segregation of duties in the personal computing : problem 1segregation of duties in the personal computing environmentwhat role should the hr organization play in this

The epa estimates that the average motor vehicle in america : the epa estimates that the average motor vehicle in america is driven 12000 miles per year epa.gov. fuel efficiencies

1nbspnbspnbspnbspnbsp ernest inc has identified the : 1.nbspnbspnbspnbspnbsp ernest inc. has identified the following overhead costs and cost drivers for next

Overview in this assignment you are provided with an : overview in this assignment you are provided with an interface that contains a generic type.you are asked to create two

Assessment item 3 this is an individual assessment and : assessment item 3 this is an individual assessment and requires you to produce a timely assignment of high quality. you

Question 1 nbspexplain each of the following using supply : question 1 nbspexplain each of the following using supply and demand diagrams.awhen a cyclone hits queensland the price

Consideration does not have to be adequate or commercially : consideration does not have to be adequate or commercially realistic nor does it need to be expressed in monetary terms

User Account

All Pages

1nbspnbspnbspnbspnbsp ernest inc has identified the

Reference no: EM13346560

Reference no: EM13346560

Questions Cloud

Reviews

Write a Review

Managerial Accounting Questions & Answers

Manage budgets and financial plans

Prepare a retained earnings statement

Prepare a master budget for the three-month period

Construct the companys direct labor budget

Evaluate the predetermined overhead rate

Determine the company''s bid

Compute the pool rates for the different activities

Prepare Company financial statements

Prepare an analysis of terracycles

Discuss the ethical issues

Political resources in emerging markets

Management accounting - ehsan electronics company

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT