Ohnston co cleans and applies powder coat paint to metal

Assignment Help Accounting Basics

Reference no: EM13588237

Ohnston Co cleans and applies powder coat paint to metal items on a job-order basis. Johnston has budgeted the following amounts for various Overhead categories in the coming yr.

Supplies 216,000
Gas 50,000
Indirect Labor 176,000
Supervision 73,500
Depreciation on equipment 47,000
depreciation on teh building 40,000
rent of special equipment 11,000
electricity (for lighting heating air con) 28,900
telephone 4,300
landscaping service 1,200
other overhead 50,000

In teh coming yr johnston expects to power coat 120,000 units. Each unit takes 1.3 DL hours. Johnston has found that supplies and gas (used to run the drying ovens-all units pass thru the drying ovens after powder coat paint is applied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed.

1.calculate the number of DL hours Johnston must budget for the coming year. CAlculate the variable OH rate. Calculate the total FO for the coming year.

2.prepare an OH budget for johnston for the coming year. Show the total variable overhead, total fixed OH and total OH. Calculate the fixed OH rate and the total OH rate.

3.What IF Johnston had expected to make 118,000 units next yr? Assume the VOH per unit does not change and total fixed amounts do not change. calculate the new budgeted DL hours and prepare a new OH budget. Calculate the fixed OH rate and the total OH rate.

Nashler Company has the following budgeted variable costs per unit produced:Budgeted FO costs per month include supervision of 98,000 depreciation of 76,000 and other OH of 245,000.

1 Prepare a flexible budget for all costs of production for the following levels of production:
160,000 units 170 units and 175000 units
2 what is the per-unit total product cost for each of the production levels from requirement 1?
3What if NAshler's cost of maintenance rose to .22 per unit? How would that affect the unit product costs calculated in requirement 2

Reference no: EM13588237

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