Assignment
I. Milsaps Company produces sportsmen's digital scales. In preparing the current budget, Milsaps' controller estimates a total of $298,000 in direct materials cost, $242,000 in direct labor cost, and $421,080 in manufacturing overhead costs. Since much of the production process requires skilled workers to assemble the scales, direct labor cost is used as the overhead application base. At the end of the period, Milsaps reported actual results as follows: direct materials cost of $303,000, direct labor cost of $200,000, and manufacturing overhead cost $343,130.
Milsaps' predetermined overhead rate for the year is 174% and manufacturing overhead Milsaps apply during the year was 348000.
What is the journal entry to close overhead if the amount is considered to be insignificant? (Enter debit entries first followed by credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Account and Explanation Credit Debit_________
Manufacturing Overhead ___________ ______________
Cost of Goods Sold ______________ _____________
II. Stockin Company produces Tablets and Books. Total overhead costs traditionally have been allocated on the basis of direct labor hours. After implementing activity-based costing, managers determined the following cost pools and cost drivers. They also decided that general costs should no longer be allocated to products.
|
Activity Pool
|
Department Costs
|
Cost driver
|
|
Binding
|
$252,843.75
|
Number of units
|
|
Printing
|
773,647.00
|
Machine hours
|
|
Product design
|
217,782.00
|
Change orders
|
|
General
|
352,777.25
|
None
|
|
Total overhead costs
|
$1,597,050.00
|
|
Other information is as follows:
|
|
Tablets
|
Books
|
|
Units
|
77,500
|
19,375
|
|
Direct materials cost per unit
|
$4.00
|
$12.00
|
|
Direct labor cost per unit
|
$5.00
|
$10.00
|
|
Direct labor hours
|
27,300
|
13,650
|
|
Machine hours
|
139,900
|
104,925
|
|
Change orders
|
1,962
|
3,924
|
Determine the unit product cost for Tablets using the traditional costing system.
Determine the unit product cost for Tablets using the traditional costing system.