Managerial Accounting Quizes and Midterm Essay example

| Question : | (TCO 2) Bubba’s Crawfish Processing Company uses a traditional overhead allocation based on direct labor hours. For the current year overhead is estimated at $2,250,000 and direct labor hours are budgeted at 415,000 hours. Actual overhead was $2,200,000 and actual direct labor hours worked were 422,000. (a) Calculate the predetermined overhead rate. (b) Calculate the overhead applied. (c) Determine the amount of overhead that is over/underapplied. | | | Student Answer: | | a) Calculate the predetermined overhead rate. 2250000/415000 = 5.4217 per hour (b) Calculate the overhead applied. 422000 x 5.4217 = 2287952 (c) Determine the amount of overhead that is over/under applied. 2287952-2200000 = 87952 over†¦show more content†¦Beginning balance in Finished Goods $ 17,000 Ending balance in Finished Goods 15,200 Beginning balance in Work in Process 2,500 Ending balance in Work in Process 1,836 Selling expenses 123,000 General and administrative expenses 89,000 Direct material cost 54,500 Direct labor cost 66,000 Manufacturing overhead 21,400 Sales 385,000 Prepare a schedule of cost of goods manufactured. | | | Student Answer: | | Snappy’s Surgical shears Company Cost of Goods Manufactured Schedule For the Month Ending in January 31, 20XX Direct Material $54,500 Direct Labour $66,000 Manufacturing Overhead $21,400 Total manufacturing cost $141,900 Add : Work in process inventory (Beginning) $2,500 Less : Work in process inventory (Ending) -$1,836 Cost of goods manufactured for the month $142,564 | | Instructor Explanation: | Sappy’s Surgical Shears Schedule