Exam 13: Accounting for Overhead Costs

Patriots Company had the following information: Budgeted factory overhead \ 85,000 Actual factory overhead \ 105,000 Budgeted: Direct-labor costs \ 100,000 Actual: Direct-labor costs \ 105,000 The journal entry to apply overhead to a job incurring $15,000 of direct-labor cost includes a _____.

Giants Company had the following information: Budgeted factory overhead \ 80,000 Actual factory overhead \ 82,000 Budgeted: Machine hours 40,000 Actual: Machine hours 39,500 The overhead applied for a company that uses 10,000 machine hours is _____.

The absorption-costing method has fixed factory overhead appearing in only cost of goods sold.

In determining the budgeted overhead application rate, the actual amount of the cost driver is used as the numerator.

In the immediate write-off approach, overapplied overhead is regarded as _____.

The fixed overhead rate is computed as_____.

A company has the following information for its first month of operations: Raw materials used \ 37,500 Sales \ 97.50 per unit) \ 117,000 Direct labor \ 63,000 Variable factory overhead \ 25,500 Fixed factory overhead unknown Variable selling and administrative \ 4,500 Fixed selling and administrative \ 7,500 Gross profit \ 35,000 Contribution margin unknown The company sold half of the units it produced.____ is the cost of goods sold under absorption costing.

Rockies Company had the following information: Budgeted factory overhead \ 90,000 Actual factory overhead \ 80,000 Budgeted: Production setups 12,000 Actual: Production setups 11,500 The budgeted factory-overhead rate using production setups as the cost driver is _____.

A company has the following information for the current month of operations: Raw materials used \ 37,500 Sales \ 97.50 per unit) \ 117,000 Direct labor \ 63,000 Variable factory overhead \ 25,500 Fixed factory overhead unknown Variable selling and administrative \ 4,500 Fixed selling and administrative \ 7,500 Gross profit \ 45,000 Contribution margin unknown Inventories: Beginning Ending Raw materials 0 \ 12,500 WIP 0 none Finished goods 0 1,200 units Raw materials purchased during the current period are_____.

Normally, 80% of the cost drivers drive 50% of the overhead costs.

_____ is are) computed for fixed overhead.

_____ is another term for variable costing.

Vikings Company incurred actual overhead costs of $297,500 for the year.A budgeted factory-overhead rate of 150% of direct-labor cost was determined at the beginning of the year.Budgeted factory overhead was $300,000, and budgeted direct-labor cost was $200,000.Actual direct-labor cost was $205,000 for the year.The factory-overhead variance for the year was_____.

The method that adjusts only the Cost of Goods Sold account for overapplied and underapplied overhead

The costing method that separates costs into major categories of fixed and variable

Direct-labor hours rather than direct-labor cost usually drive fringe-benefit costs such as pensions and payroll taxes.

The variable-costing method regards fixed manufacturing costs as expenses in the period they are incurred.

The most widely used approach to disposing of overhead variances is _____.

A company has the following information for its first month of operations: Raw materials used \ 25,000 Sales \ 65 per unit) \ 78,000 Direct labor \ 42,000 Variable factory overhead \ 17,000 Fixed factory overhead unknown Variable selling and administrative \ 3,000 Fixed selling and administrative \ 5,000 Gross profit \ 30,000 Contribution margin unknown Ending inventories: Raw materials \ 10,000 WIP none Finished goods 1,200 units Raw materials purchased during the current period are_____.

Phillies Company had the following information: Budgeted variable factory overhead \ 66,000 Budgeted fixed factory overhead \ 46,500 Actual variable factory overhead \ 77,500 Actual fixed factory overhead \ 62,500 Budgeted cost-driver activity levels: Direct-labor hours 30,000 Direct-labor costs \ 160,000 Machine hours 60,000 Production setups 15,000 Actual cost-driver activity levels: Direct-labor hours 31,500 Direct-labor costs \ 165,600 Machine hours 56,190 Production setups 14,280 The budgeted factory-overhead rate using direct-labor costs as the cost driver is _____.