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Fundamentals of Cost Accounting 2nd Edition by William Lanen, Carolyn Wells, Michael Maher
Edition 2ISBN: 978-0077274993Fundamentals of Cost Accounting 2nd Edition by William Lanen, Carolyn Wells, Michael Maher
Edition 2ISBN: 978-0077274993 Exercise 27
Predetermined Overhead Rates
Cardinals, Inc., manufactures one product and accounts for costs using a job cost system. You have obtained the following information from the corporation's books and records for the year ended December 31, Year 1:
•Total manufacturing cost during the year was $2,000,000 based on actual direct material, actual direct labor, and applied manufacturing overhead.
•Manufacturing overhead was applied to work in process at 150 percent of direct labor dollars. Applied manufacturing overhead for the year was 50 percent of the total manufacturing cost during the year.
Required
Compute actual direct material used, actual direct labor, and applied manufacturing overhead. ( Hint: The total of these costs is $2,000,000.)
Cardinals, Inc., manufactures one product and accounts for costs using a job cost system. You have obtained the following information from the corporation's books and records for the year ended December 31, Year 1:
•Total manufacturing cost during the year was $2,000,000 based on actual direct material, actual direct labor, and applied manufacturing overhead.
•Manufacturing overhead was applied to work in process at 150 percent of direct labor dollars. Applied manufacturing overhead for the year was 50 percent of the total manufacturing cost during the year.
Required
Compute actual direct material used, actual direct labor, and applied manufacturing overhead. ( Hint: The total of these costs is $2,000,000.)
Explanation
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Job shops use predetermined rates to ass...
Fundamentals of Cost Accounting 2nd Edition by William Lanen, Carolyn Wells, Michael Maher
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