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*The Thomlin Company estimates that total overhead for the current year will be

ID: 2550834 • Letter: #

Question

*The Thomlin Company estimates that total overhead for the current year will be $16,000,000 and that total machine hours will be 200,000 hours. Year to date, the actual overhead is $16,500,000 and the actual machine hours are 220,000 hours. If the Thomlin Company uses a predetermined overhead rate based on machine hours for applying overhead, what is that overhead rate?

Question 11 options:

$75 per machine hour

$73 per machine hour

$83 per machine hour

$80 per machine hour

On January 15, $168,000 of direct materials were requisitioned for production of Job 350. From the following, select the correct journal entry to record the transaction on the day the materials were requisitioned by the production department.

Question 12 options:

Jan 15 Work in Process 168,000

Factory Overhead 168,000

Jan 15 Work in Process 168,000

Cash 168,000

Jan 15 Materials 168,000

Work in Process 168,000

Jan 15 Work in Process 168,000

Materials 168,000

A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $675,000 and direct labor hours would be 45,000. Actual factory overhead costs incurred were $725,000, and actual direct labor hours were 48,000. What is the amount of overapplied or underapplied manufacturing overhead at the end of the year?

Question 13 options:

$5,000 underapplied

$45,000 overapplied

$45,000 underapplied

$5,000 overpplied

Department R had 5,000 units in work in process that were 85% completed as to conversion cost at the beginning of the period, 30,000 units of direct materials were added during the period, 32,000 units were completed during the period, and 3,000 units were 60% completed as to conversion cost at the end of the period. All materials are added at the beginning of the process. The first-in, first-out method is used to cost inventories. The number of equivalent units of production for conversion costs for the period was:

Question 14 options:

29,450 units

29,550 units

33,050 units

32,550 units

The debits to Work in Process--Assembly Department for April, together with data concerning production, are as follows:

Work in process, April 1, 5,000 units:

Direct materials cost, for 5,000 units

$  8,000

Conversion costs, for 5,000 units, 66.7% completed

$ 6,000

Direct materials added during April, 10,000 units

$ 38,000

Conversion costs during April

$ 31,000

Goods finished during April, 13,000 units

---

April 30 work in process, 2,000 units, 50% completed

---

All direct materials are placed in process at the beginning of the process and the first-in, first-out method is used to cost inventories. The direct materials cost per equivalent unit for April is:

Question 15 options:

$2.92 per unit

$3.80 per unit

$2.53 per unit

$3.00 per unit

Mocha Company manufactures a single product by a continuous process, involving two production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $50,000, $60,000, and $70,000, respectively.

The journal entry to record the flow of costs into Department 1 during the period for applied factory overhead is:

Question 16 options:

Factory Overhead--Department 1 70,000

Wages Payable 70,000

Work in Process--Department 1 150,000

Factory Overhead--Department 1 150,000

Work in Process--Department 1 70,000

Factory Overhead--Department 1 70,000

Factory Overhead--Department 1 150,000

Work in Process--Department 1 150,000

*Given the following cost and activity observations for Bounty Company’s utilities, Bounty’ variable utilities costs per machine hour is equal to:

Total Cost

Machine Hours

March

$6,200

30,000

April

5,400

20,000

May

5,800

24,000

June

7,200

36,000

Question 17 options:

$0.11

$10.00

$0.27

$0.20

Flying Cloud Co. has the following operating data for its manufacturing operations:

Unit selling price

$ 350

Unit variable cost

$ 100

Total fixed costs

$980,000

The company has decided to increase the wages of hourly workers which will increase the unit variable cost by 10%. Increases in the salaries of factory supervisors and property taxes for the factory will increase fixed costs by 5%. If sales prices are held constant, the next break-even point for Flying Cloud Co. will be:

Question 19 options:

increased by 368 units

increased by 132 units

decreased by 264 units

decreased by 368 units

Bobby Co. sells two products, X and Y. Last year, Bobby sold 18,000 units of X's and 12,000 units of Y's. The unit selling price, variable cost per unit, and contribution margin per unit for the company’s two products are provided below.

Product

Selling Price

Variable Cost per unit

Contribution Margin

per unit

X

$180

$100

$80

Y

$100

$60

$40

Assuming that last year’s fixed costs totaled $160,000. What was Bobby Co's break-even point in units of enterprise product "E"?

Question 20 options:

2,000 units

2,857 units

2,500 units

6,000 units

If fixed costs are $1,500,000 ; the unit selling price is $250, and the unit variable costs are $130, what is the amount of sales (in units) required to realize an income from operations of $200,000?

Question 22 options:

16,000 units

12,500 units

11,538 units

14,167 units

If the costs for direct materials, direct labor, and factory overhead were $522,200, $82,700, and $45,300, respectively, for 16,000 equivalent units of conversion costs, the conversion cost per equivalent unit was $8.00

Question 21 options:

$75 per machine hour

$73 per machine hour

$83 per machine hour

$80 per machine hour

On January 15, $168,000 of direct materials were requisitioned for production of Job 350. From the following, select the correct journal entry to record the transaction on the day the materials were requisitioned by the production department.

Question 12 options:

Jan 15 Work in Process 168,000

Factory Overhead 168,000

Jan 15 Work in Process 168,000

Cash 168,000

Jan 15 Materials 168,000

Work in Process 168,000

Jan 15 Work in Process 168,000

Materials 168,000

A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $675,000 and direct labor hours would be 45,000. Actual factory overhead costs incurred were $725,000, and actual direct labor hours were 48,000. What is the amount of overapplied or underapplied manufacturing overhead at the end of the year?

Question 13 options:

$5,000 underapplied

$45,000 overapplied

$45,000 underapplied

$5,000 overpplied

Department R had 5,000 units in work in process that were 85% completed as to conversion cost at the beginning of the period, 30,000 units of direct materials were added during the period, 32,000 units were completed during the period, and 3,000 units were 60% completed as to conversion cost at the end of the period. All materials are added at the beginning of the process. The first-in, first-out method is used to cost inventories. The number of equivalent units of production for conversion costs for the period was:

Question 14 options:

29,450 units

29,550 units

33,050 units

32,550 units

The debits to Work in Process--Assembly Department for April, together with data concerning production, are as follows:

Work in process, April 1, 5,000 units:

Direct materials cost, for 5,000 units

$  8,000

Conversion costs, for 5,000 units, 66.7% completed

$ 6,000

Direct materials added during April, 10,000 units

$ 38,000

Conversion costs during April

$ 31,000

Goods finished during April, 13,000 units

---

April 30 work in process, 2,000 units, 50% completed

---

All direct materials are placed in process at the beginning of the process and the first-in, first-out method is used to cost inventories. The direct materials cost per equivalent unit for April is:

Question 15 options:

$2.92 per unit

$3.80 per unit

$2.53 per unit

$3.00 per unit

Mocha Company manufactures a single product by a continuous process, involving two production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $50,000, $60,000, and $70,000, respectively.

The journal entry to record the flow of costs into Department 1 during the period for applied factory overhead is:

Question 16 options:

Factory Overhead--Department 1 70,000

Wages Payable 70,000

Work in Process--Department 1 150,000

Factory Overhead--Department 1 150,000

Work in Process--Department 1 70,000

Factory Overhead--Department 1 70,000

Factory Overhead--Department 1 150,000

Work in Process--Department 1 150,000

*Given the following cost and activity observations for Bounty Company’s utilities, Bounty’ variable utilities costs per machine hour is equal to:

Total Cost

Machine Hours

March

$6,200

30,000

April

5,400

20,000

May

5,800

24,000

June

7,200

36,000

Question 17 options:

$0.11

$10.00

$0.27

$0.20

Flying Cloud Co. has the following operating data for its manufacturing operations:

Unit selling price

$ 350

Unit variable cost

$ 100

Total fixed costs

$980,000

The company has decided to increase the wages of hourly workers which will increase the unit variable cost by 10%. Increases in the salaries of factory supervisors and property taxes for the factory will increase fixed costs by 5%. If sales prices are held constant, the next break-even point for Flying Cloud Co. will be:

Question 19 options:

increased by 368 units

increased by 132 units

decreased by 264 units

decreased by 368 units

Bobby Co. sells two products, X and Y. Last year, Bobby sold 18,000 units of X's and 12,000 units of Y's. The unit selling price, variable cost per unit, and contribution margin per unit for the company’s two products are provided below.

Product

Selling Price

Variable Cost per unit

Contribution Margin

per unit

X

$180

$100

$80

Y

$100

$60

$40

Assuming that last year’s fixed costs totaled $160,000. What was Bobby Co's break-even point in units of enterprise product "E"?

Question 20 options:

2,000 units

2,857 units

2,500 units

6,000 units

If fixed costs are $1,500,000 ; the unit selling price is $250, and the unit variable costs are $130, what is the amount of sales (in units) required to realize an income from operations of $200,000?

Question 22 options:

16,000 units

12,500 units

11,538 units

14,167 units

If the costs for direct materials, direct labor, and factory overhead were $522,200, $82,700, and $45,300, respectively, for 16,000 equivalent units of conversion costs, the conversion cost per equivalent unit was $8.00

Question 21 options:

True False

Explanation / Answer

SOLUTION

1. Overhead rate = $80 per machine hour

Predetermined overhead rate is used to apply the overhead to a product.

It is calculated by dividing the estimated manufacturing overhead cost by the allocation base.

Overhead rate =Total estimated overhead cost / Total estimated quantity of the overhead allocation base

= $16,000,000 / 200,000 hours

= $80 per machine hour