Reference no: EM132843019

Question 1 - Hahn Company uses a job-order costing system. Its plant wide predetermined overhead rate uses direct labor-hours as the allocation base. The company pays its direct laborers $20.00 per hour. During the year, the company started and completed only two jobs-Job Alpha, which used 66,700 direct labor-hours, and Job Omega. The job cost sheets for the these two jobs are shown below:

Required -

1. Calculate the plant wide predetermined overhead rate.

2. Complete the job cost sheet for Job Alpha.

Question 2 - Newhard Company assigns overhead cost to jobs on the basis of 120% of direct labor cost. The job cost sheet for Job 313 includes $27,380 in direct materials cost and $10,100 in direct labor cost. A total of 1,600 units were produced in Job 313.

Required -

a. What is the total manufacturing cost assigned to Job 313?

b. What is the unit product cost for Job 313?

Question 3 - Moody Corporation uses a job-order costing system with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company made the following estimates:

Required -

1. Compute the plant wide predetermined overhead rate.

2. During the year, Job 400 was started and completed. The following information was available with respect to this job:

Direct materials $380

Direct labor cost $290

Machine-hours used 40

Compute the total manufacturing cost assigned to Job 400.

3. If Job 400 includes 50 units, what is the unit product cost for this job?

4. If Moody uses a markup percentage of 130% of its total manufacturing cost, then what selling price per unit would it have established for Job 400?

Question 4 - White Company has two departments, Cutting and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each department. The Cutting Department bases its rate on machine-hours, and the Finishing Department bases its rate on direct labor-hours. At the beginning of the year, the company made the following estimates:

Required -

1. Compute the predetermined overhead rate for each department.

2. The job cost sheet for Job 203, which was started and completed during the year, showed the following:

Using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to Job 203.

3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plant wide predetermined overhead rate based on direct labor-hours, rather than using departmental rates?

Question 5 - Wilmington Company has two manufacturing departments--Assembly and Fabrication. It considers all of its manufacturing overhead costs to be fixed costs. The first set of data that is shown below is based on estimates from the beginning of the year. The second set of data relates to one particular job completed during the year--Job Bravo.

Required -

1. If Wilmington used a plant wide predetermined overhead rate based on direct labor-hours, how much manufacturing overhead would be applied to Job Bravo?

2. If Wilmington uses departmental predetermined overhead rates with direct labor-hours as the allocation base in Assembly and machine-hours as the allocation base in Fabrication, how much manufacturing overhead would be applied to Job Bravo?

Question 6 - Speedy Auto Repairs uses a job-order costing system. The company's direct materials consist of replacement parts installed in customer vehicles, and its direct labor consists of the mechanics' hourly wages. Speedy's overhead costs include various items, such as the shop manager's salary, depreciation of equipment, utilities, insurance, and magazine subscriptions and refreshments for the waiting room.

The company applies all of its overhead costs to jobs based on direct labor-hours. At the beginning of the year, it made the following estimates:

Direct labor-hours required to support estimated output 22,000

Fixed overhead cost $253,000

Variable overhead cost per direct labor-hour $1.00

Required -

1. Compute the predetermined overhead rate.

2. During the year, Mr. Wilkes brought in his vehicle to replace his brakes, spark plugs, and tires. The following information was available with respect to his job:

Direct materials $703

Direct labor cost $317

Direct labor-hours used 8

Compute Mr. Wilkes' total job cost.

3. If Speedy establishes its selling prices using a markup percentage of 40% of its total job cost, then how much would it have charged Mr. Wilkes?

Question 7 - High Desert Potteryworks makes a variety of pottery products that it sells to retailers. The company uses a job-order costing system in which departmental predetermined overhead rates are used to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Molding Department is based on machine-hours, and the rate in the Painting Department is based on direct labor-hours. At the beginning of the year, the company provided the following estimates:

Job 205 was started on August 1 and completed on August 10. The company's cost records show the following information concerning the job:

Required -

1. Compute the predetermined overhead rates used in the Molding Department and the Painting Department.

2. Compute the total overhead cost applied to Job 205.

3-a. What would be the total manufacturing cost recorded for Job 205?

3-b. If the job contained 37 units, what would be the unit product cost?