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    Cost Accounting

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    Use the following information for questions 18-19.

    Becker Company developed the following data for the current year:
    Beginning work in process inventory $ 60,000
    Direct materials used 36,000
    Actual overhead 72,000
    Overhead applied 54,000
    Cost of goods manufactured 66,000
    Total manufacturing costs 180,000

    18. Becker Company's direct labor cost for the year is
    a. $18,000.
    b. $90,000.
    c. $54,000.
    d. $72,000.

    19. Becker Company's ending work in process inventory is
    a. $174,000.
    b. $120,000.
    c. $114,000.
    d. $54,000.

    Use the following information to answer questions 25-26.
    Robot Toy Company manufactures two products, X-O-Tron and Mechoman. Robot's overhead costs consist of setting up machines, $400,000; machining, $900,000; and inspecting, $300,000. Information on the two products is:
    X-O-Tron Mechoman
    Direct labor hours 15,000 25,000
    Machine setups 600 400
    Machine hours 24,000 26,000
    Inspections 800 700

    25. Overhead applied to X-O-Tron using traditional costing is
    a. $600,000.
    b. $768,000.
    c. $832,000.
    d. $960,000.

    26. Overhead applied to Mechoman using traditional costing is
    a. $640,000.
    b. $768,000.
    c. $832,000.
    d. $1,000,000.

    27. Overhead applied to X-O-Tron using activity-based costing is
    a. $600,000.
    b. $768,000.
    c. $832,000.
    d. $960,000.

    28. Overhead applied to Mechoman using activity-based costing is
    a. $640,000.
    b. $768,000.
    c. $832,000.
    d. $1,000,000.

    Use the following information for questions 34-36.

    Staley Company has a materials price standard of $3.00 per pound. Two thousand pounds of materials were purchased at $3.30 a pound. The actual quantity of materials used was 2,000 pounds, although the standard quantity allowed for the output was 1,800 pounds.

    34. Staley Company's materials price variance is
    a. $60 U.
    b. $600 U.
    c. $540 U.
    d. $600 F.

    35. Staley Company's materials quantity variance is
    a. $600 U.
    b. $600 F.
    c. $660 F.
    d. $660 U.

    36. Staley Company's total materials variance is
    a. $1,200 U.
    b. $1,200 F.
    c. $1,260 U.
    d. $1,260 F.

    Use the following information for questions 37-38.
    Downing Company produces a high resolution computer monitor. The following information is available for this product:
    Fixed cost per unit $ 50
    Variable cost per unit 150
    Total cost per unit 200
    Desired ROI per unit 60

    37. Downing Company's markup percentage would be
    a. 120%.
    b. 60%.
    c. 40%.
    d. 30%.
    38. The target selling price for this monitor is
    a. $110.
    b. $200.
    c. $210.
    d. $260.

    Vid-saver, Inc. has five activity cost pools and two products (a budget tape rewinder and a deluxe tape rewinder). Information is presented below:

    Cost Drivers by Product
    Activity Cost Pool Cost Driver Est. Overhead Budget Deluxe
    Ordering and Receiving Orders $ 120,000 600 400
    Machine Setup Setups 297,000 500 400
    Machining Machine hours 1,500,000 150,000 100,000
    Assembly Parts 1,200,000 1,200,000 800,000
    Inspection Inspections 300,000 550 450

    Instructions
    Compute the overhead cost per unit for each product. Production is 700,000 units of Budget and 200,000 units of Deluxe.

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    https://brainmass.com/business/accounting/cost-accounting-126349

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    Use the following information for questions 18-19.

    Becker Company developed the following data for the current year:
    Beginning work in process inventory $ 60,000
    Direct materials used 36,000
    Actual overhead 72,000
    Overhead applied 54,000
    Cost of goods manufactured 66,000
    Total manufacturing costs 180,000

    18. Becker Company's direct labor cost for the year is
    a. $18,000.
    b. $90,000.
    c. $54,000.
    d. $72,000.

    Total manufacturing cost = Direct Material + Direct Labor + Applied Overhead

    180,000 = 36,000+Direct Labor + 54,000

    Direct Labor = 90,000
    We use the applied overhead since that is debited to the work in process account. The actual overhead is a debit in overhead account and the over under applied overhead is closed at the end of the period

    19. Becker Company's ending work in process inventory is
    a. $174,000.
    b. $120,000.
    c. $114,000.
    d. $54,000.

    Cost of goods Manufactured = Opening WIP + Total manufacturing cost - Ending WIP

    66,000=60,000+180,000-Ending WIP

    Ending WIP = 174,000

    Use the following information to answer questions 25-26.
    Robot Toy Company manufactures two products, X-O-Tron and Mechoman. Robot's overhead costs consist of setting up machines, $400,000; machining, $900,000; and inspecting, $300,000. Information on the two products is:
    X-O-Tron Mechoman
    Direct labor hours 15,000 25,000
    Machine setups 600 400
    Machine hours 24,000 26,000
    Inspections 800 700

    25. Overhead applied to X-O-Tron using traditional costing ...

    Solution Summary

    The solution explains various multiple choice questions in cost accounting

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