Nevin uses machine hours as the cost driver to allocate

Assignment Help Accounting Basics

Reference no: EM13599152

Nevin Company makes three products in its factory: plastic cups, plastic tablecloths, and plastic bottles. The expected overhead costs for the next fiscal year include the following.

factory managers salary $260,000
factory utility cost 121,000
factory supplies 56,000
total overhead costs $437,000

Nevin uses machine hours as the cost driver to allocate overhead costs. Budgeted machine hours for the products are as follows.

cups 420 hours
tablecloths 740
bottles 1,140
total machine hours 2,300

Required
A. Allocate the budgeted overhead costs to the products.
B. Provide a possible explanation as to why Nevin chose machine hours, instead of labor hours, as the allocation base.

Reference no: EM13599152

Questions Cloud

The representative who processed 1000 customer complaints : stevens air is a large airline company that pays a customer relation representative 4000 per month. the representative

Prepare the journal entries to record income tax expense : 1. depreciation reported on the tax return exceeded depreciation reported on the income statement by 120000. this

Part j88 is used in one of quinney corporations products : part j88 is used in one of quinney corporations products. the company makes 3000 units of this part each year. the

Allocating overhead costs among products nevin company : allocating overhead costs among products nevin company makes three products in its factory plastic cups plastic

Nevin uses machine hours as the cost driver to allocate : nevin company makes three products in its factory plastic cups plastic tablecloths and plastic bottles. the expected

Astin blair is the manager of a medium-size company a few : astin blair is the manager of a medium-size company. a few years ago blair persuaded the owner to base a part of his

You are an accountant in the budgetary projections and : you are an accountant in the budgetary projections and special projects department of american conductor inc. a large

Cinnamon buns co cbc started 2011 with 52700 of merchandise : cinnamon buns co. cbc started 2011 with 52700 of merchandise on hand. during 2011 286000 in merchandise was purchased

Meredith and martin form the cash-basis calendar-year mm : meredith and martin form the cash-basis calendar-year mm partnership on july 1 of the current year. they purchase

User Account

All Pages