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    Gapas, Daniel John L. (Etivity 10)

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    Daniel John Gapas
    The document discusses cost accounting problems involving factory overhead application and allocation. Problem 1 shows different methods to allocate overhead, such as a percentage of direct material cost or cost per direct labor hour. Problem 10 demonstrates the high-low method to separate fixed and variable overhead, and calculates variances. Problem 11 shows how to close out over- or under-applied overhead. Problem 12 allocates overhead to products using different allocation bases and calculates the cost per unit for each product.

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    Gapas, Daniel John L. (Etivity 10)

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    Daniel John Gapas
    55 views4 pages
    The document discusses cost accounting problems involving factory overhead application and allocation. Problem 1 shows different methods to allocate overhead, such as a percentage of direct material cost or cost per direct labor hour. Problem 10 demonstrates the high-low method to separate fixed and variable overhead, and calculates variances. Problem 11 shows how to close out over- or under-applied overhead. Problem 12 allocates overhead to products using different allocation bases and calculates the cost per unit for each product.

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    Cost Accounting

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    Gapas, Daniel John L.(Etivity 10)

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    The document discusses cost accounting problems involving factory overhead application and allocation. Problem 1 shows different methods to allocate overhead, such as a percentage of direct material cost or cost per direct labor hour. Problem 10 demonstrates the high-low method to separate fixed and variable overhead, and calculates variances. Problem 11 shows how to close out over- or under-applied overhead. Problem 12 allocates overhead to products using different allocation bases and calculates the cost per unit for each product.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    55 views4 pages

    Gapas, Daniel John L. (Etivity 10)

    Uploaded by

    Daniel John Gapas
    The document discusses cost accounting problems involving factory overhead application and allocation. Problem 1 shows different methods to allocate overhead, such as a percentage of direct material cost or cost per direct labor hour. Problem 10 demonstrates the high-low method to separate fixed and variable overhead, and calculates variances. Problem 11 shows how to close out over- or under-applied overhead. Problem 12 allocates overhead to products using different allocation bases and calculates the cost per unit for each product.

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    Gapas, Daniel John L.

    Cost Accounting and Control

    E-TIVITY 10
    Problem 1

    1) Material Cost = Estimated Factory Overhead


    x 100
    Estimated Direct Material Cost

    = 1,000,000
    x 100
    800,000

    = 125% of Direct Material Cost

    2) Units of Production = Estimated Factory Overhead


    Estimated Units of Production

    = 1,000,000
    20,000

    = 50/unit

    3) Machine Hours = Estimated Factory Overhead


    Estimated Machine Hours

    = 1,000,000
    160,000

    = 6.25/Machine Hour

    4) Direct Labor Cost = Estimated Factory Overhead


    x 100
    Estimated Direct Labor Cost

    = 1,000,000
    x 100
    500,000

    = 200% of Direct Labor Cost

    5) Direct Labor Hours = Estimated Factory Overhead


    Estimated Direct Labor Hours

    = 1,000,000
    50,000

    = 20/ Direct Labor Hour


    Problem 10
    1. HIGH-LOW METHOD
    Variable rate per hour = 270,000-252,000
    60,000-48,000
    = 18,000
    12,000
    = P1.50/direct labor hr.
    2.
    HIGH LOW
    Total Cost 270,000 252,000
    Less: Variable portion
    60,000 x P1.50 90,000
    48,000 x P1.50 72,000
    Fixed Portion P180,000 P180,000

    3.
    Actual Factory Overhead P273,000
    Budgeted allowance on actual
    hours:
    Fixed P180,000
    Variable (60,000 x 90%) x 5.25 81,000 261,000
    Spending Variance- Unfavorable P12,000

    4.
    Budget allowed on actual hours P261,000
    Applied FO (60,000 x 90%) x P5. 25 283,500
    Idle capacity variance-Favorable P(22,500)

    Problem 11
    A.
    Actual Factory Overhead P30,500
    Applied Factory Overhead 39,700
    Overapplied Factory Overhead P(9,200)

    Cost of Goods Sold 32,000 x 9,200 P7,416


    39,700
    Work in Process 3,500 x 9,200 811

    39,700

    Finished Goods 4,200 x 9,200 973

    39,700

    Total 39,700 P9,200

    B.
    P
    Date Explanation R Debit Credit
     
         Factory Overhead Applied         3 9 7 0 0                
     
          Cost of Goods Sold                           7 4 1 6
     
          Finished Goods                             9 7 3
     
          Work in Process                             8 1 1
     
          Factory Overhead Control                         3 0 5 0 0
          To close FOH accounts                                  

    Problem 12
    1.
    PRODUCT A PRODUCT B
    Direct Materials 50 x P120 P6,000 100 x120 P12,000
    Direct Labor 6,000 18,000
    Factory 100 x P25 2,500 300 x P25 7,500
    Overhead
    Total P14,500 P37,500
    Manufacturing
    Cost
    No. of Units 50 100
    Cost per Unit P290/unit P375/unit

    2.
    PRODUCT A PRODUCT B
    Direct Materials 50 x P120 P6,000 100 x120 P12,000
    Direct Labor 6,000 18,000
    Factory
    Overhead:
    Material 20 x 50 1,000 40 x P50 2,000
    Handling
    Scheduling and 200 x P5 1,000 200 x 7 1,400
    setup
    Design Section 3 x P107.50 322.50 5 x P107.50 537.50
    No. of Parts 6 x 100 600 10 x 100 1,000
    Total Cost P14,922.50 P34,937.50
    No. of Units 50 100
    Cost per Unit P298.45/unit P349.38/unit

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