Reference no: EM131752919

Question 1. The following calendar year information about the Tahoma Corporation is available on December 31:

Advertising expense.................28,800

depreciation of factory equipment...42,320

depreciation of office equipment....10,800

direct labor........................142,600

factory utiXXties...................35,650

interest expense....................6,650

inventories Jan. 1

Raw materials....................3,450

Goods in process.................17,250

finished goods...................35,650

inventories Dec. 31

Raw materials....................2,300

Goods in process.................20,700

Finsished goods..................31,050

Raw materials purchases.............132,450

Rent on factory building............41,400

Indirect labor......................51,750

Sales commissions...................16,500

The company applies overhead on the basis of 125% of direct labor costs. Calculate the amount of over- or underapplied overhead.

Question 2. A company uses a process cost accounting system. The following information is available regarding direct labor for the current year:

>Goods in process, January 1.....5,500 units, 80% complete

>goods in process, dec 31.....8,800 units, 40% complete

>units completed and tansferred to finished goods.....46,900 units

>Direct labor costs during the year....$266,300

(a) Calculate the equivalent units of production for direct labor for the year.

(b) Calculate the average cost per equivalent unit for direct labor (round to the nearest cent).

Question 3. A retail store has three departments, A, B, and C, each of which has four full-time employees. The store does general advertising that benefits all departments. Advertising expense totaled $90,000 for the current year, and departmental sales were:

Dept A......356,250

Dept B......641,250

Dept C......427,500

How much advertising expense should be allocated to each department?