ACC 561 Week 4 Assignment Wiley PLUS .pdf
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ACC 561 Week 4 Assignment Wiley PLUS
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Duggan Company applies manufacturing overhead to jobs on the basis of machine hours
used. Overhead costs are expected to total $277,640 for the year, and machine usage is
estimated at 126,200 hours.
For the year, $291,977 of overhead costs are incurred and 130,300 hours are used.
(a). Compute the manufacturing overhead rate for the year. (Round answers to 2 decimal
places, e.g. 1.25.)
(b) What is the amount of under- or overapplied overhead at December 31?
(c) Prepare the adjusting entry to assign the under- or overapplied overhead for the year to
cost of goods sold. (Credit account titles are automatically indented when amount is
entered. Do not indent manually.)
ledger of Custer Company has the following work in process account.
Work in Process—Painting
5/1 Balance 3,870
5/31 Transferred out ?
5/31 Materials 6,750
5/31 Labor 4,800
5/31 Overhead 1,570
5/31 Balance ?
Production records show that there were 440 units in the beginning inventory, 30%
complete, 1,510 units started, and 1,510 units transferred out. The beginning work in
process had materials cost of $2,150 and conversion costs of $1,720. The units in ending
inventory were 40% complete. Materials are entered at the beginning of the painting
(a) How many units are in process at May 31?
Work in process, May 31
(b) What is the unit materials cost for May? (Round unit costs to 2 decimal places, e.g.
The unit materials cost for May
(c) What is the unit conversion cost for May? (Round unit costs to 2 decimal places, e.g.
The unit conversion cost for May
(d) What is the total cost of units transferred out in May? (Round answer to 0 decimal
places, e.g. 1,225.)
(e) What is the cost of the May 31 inventory? (Round answer to 0 decimal places, e.g.
Wilkins Inc. has two types of handbags: standard and custom. The controller has decided
to use a plantwide overhead rate based on direct labor costs. The president has heard of
activity-based costing and wants to see how the results would differ if this system were
used. Two activity cost pools were developed: machining and machine setup. Presented
below is information related to the company’s operations.
Direct labor costs
Total estimated overhead costs are $308,300. Overhead cost allocated to the machining
activity cost pool is $198,500, and $109,800 is allocated to the machine setup activity cost
(a) Compute the overhead rate using the traditional (plantwide) approach. (Round
answers to 2 decimal places, e.g. 12.25%.)
Predetermined overhead rate
% of direct labor cost
(b) Compute the overhead rates using the activity-based costing approach. (Round answers
to 2 decimal places, e.g. $12.25.)
per machine hour
per setup hour
(c) Determine the difference in allocation between the two approaches. (Round answers to 0
decimal places, e.g. $1,225.)
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