Reference no: EM13507337

1. Lee Company's work-in-process inventory balance on June 30 was

A. $9,450.
B. $4,100.
C. $3,940.
D. $3,300.

2. Becky works on the assembly line of a manufacturing company where she installs a component part for one of the company's products. She's paid $16 per hour for regular time, and time and a half for all work in excess of 40 hours per week. Becky's employer offers fringe benefits that cost the company $3 for each hour of employee time (both regular and overtime). During a given week, Becky works 42 hours but is idle for 3 hours due to material shortages. The company treats all fringe benefits relating to direct labor as added direct labor cost and the remainder as part of manufacturing overhead. The allocation of Becky's wages and fringe benefits for the week between direct labor cost and manufacturing overhead would be which of the following?

3. Freeman Company uses a predetermined overhead rate based on direct-labor hours to apply manufacturing overhead to jobs. At the beginning of the year, the company estimated manufacturing overhead would be $150,000 and direct-labor hours would be 10,000. The actual figures for the year were $186,000 for manufacturing overhead and 12,000 direct-labor hours. The cost records for the year will show

A. underapplied overhead of $6,000.
B. overapplied overhead of $6,000.
C. underapplied overhead of $30,000.
D. overapplied overhead of $30,000.

4. The cost per equivalent unit for materials for the month in the first processing department is closest to

A. $11.99.
B. $12.44.
C. $11.82.
D. $11.39.

5. Lee Company's cost of goods sold for June was

A. $14,640.
B. $15,520.
C. $10,170.
D. $9,730.

6. What are the equivalent units for conversion costs for the month in the first processing department?
A. 10,000
B. 360
C. 8,200
D. 8,560

7. The management of Baggerly Corporation would like to investigate the possibility of basing its predetermined overhead rate on activity at capacity. The company's controller has provided an example to illustrate how this new system would work. In this example, the allocation base is machine hours, and the estimated amount of the allocation base for the upcoming year is 81,000 machine hours. In addition, capacity is 95,000 machine hours, and the actual level of activity for the year is 84,900 machine hours.

All of the manufacturing overhead is fixed and is $6,617,700 per year. For simplicity, it's assumed that this is the estimated manufacturing overhead for the year as well as the manufacturing overhead at capacity. It's further assumed that this is also the actual amount of manufacturing overhead for the year. If the company bases its predetermined overhead rate on capacity, by how much was manufacturing
overhead underapplied or overapplied?

A. $703,566 underapplied
B. $318,630 overapplied
C. $318,630 underapplied
D. $703,566 overapplied