1.Laudermilk produces dairy equipment. Most of its jobs have a number of units p

Question

1.Laudermilk produces dairy equipment. Most of its jobs have a number of units per job. The company has two different departments through which all jobs pass. Overhead is applied using a plantwide rate of $13 per direct labor hour. Direct labor wages average $8 an hour. Data for Job #3 for the year is:

Direct materials
$40,000
Direct labor costs


Dept. A
60,000

Dept. B
12,000
Machine hours used


Dept. A
200

Dept. B
2,400
Units produced
20,000
Compute the cost per unit.


A) none of these
B) $11.58
C) $5.60
D) $11.45
E) $5.73




2. Warwick Company has the following transactions for the month of September:

Purchased materials on account for $220,384.
Materials requisitioned for $91,562.
Direct labor for the month was incurred (but not yet paid) of $69,000
Actual overhead for the month was $41,000. It has not been paid yet (Charge to various payables)
Overhead is applied to production at the rate of 65% of direct labor.
Jobs totaling $42,500 were transferred from Work-in-Process to Finished Goods.
Jobs costing $23,000 were sold.

Balances at the beginning of the month were:
Materials
22,760
Work-in-Process
0
Finished Goods
10,040


What is the ending balance of Finished Goods?




A) $64,321
B) $23,321
C) $0
D) $29,540
E) $10,040


4.
When purchasing raw materials on account, what type of accounts would increase?
A) Liabilities and expenses
B) Assets and expenses
C) Assets and equity
D) Liabilities and revenues
E) Assets and liabilities

Explanation / Answer

1. Compute the cost per unit. Total cost = 40,000 + 60,000 + 12,000 + 13*(60,000 + 12,000)/8 = 229,000 Per unit cost: 229,000/20,000 = 11.45 D) $11.45 2. Warwick Company has the following transactions for the month of September: What is the ending balance of Finished Goods? 10,040 + 42,500 – 23,000 = 29,540 D) $29,540 4. When purchasing raw materials on account, what type of accounts would increase? E) Assets and liabilities

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.