11 . ( TCO B ) Wahr Corporation bases its predetermined overhead rate on the estimated labor hours for the upcoming year . At the beginning of the most recently completed year , the company estimated the labor hours for the upcoming year at 35,000 . The estimated variable manufacturing overhead was $ 7.25 per labor hour and the estimated total fixed manufacturing overhead was $ 585,000 . The actual labor hours for the year turned out to be 33,000 . ================================================== ACCT 505 Final Exam Guide ( New ) Set 1
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Actual Costs Incurred Static Budget
Activity level ( in units ) 5,250 5,178 Variable costs : Indirect materials $ 24,182 $ 23,476 Utilities $ 22,356 $ 22,674
Fixed costs : Administration $ 63,450 $ 65,500 Rent $ 65,317 $ 63,904 ( Points : 25 ) 10 . ( TCO H ) Lindon Company uses 10,000 units of Part Y each year as a component in the assembly of one of its products . The company is presently producing Part Y internally at a total cost of $ 100,000 as follows . Direct materials ............................................... $ 20,000 Direct labor ...................................................... 40,000 Variable manufacturing overhead ...................... 16,000 Fixed manufacturing overhead ....................... 24,000 Total costs ....................................................... 100,000 An outside supplier has offered to provide Part Y at a price of $ 10 per unit . If Lindon stops producing the part internally , one third of the fixed manufacturing overhead would be eliminated .
11 . ( TCO B ) Wahr Corporation bases its predetermined overhead rate on the estimated labor hours for the upcoming year . At the beginning of the most recently completed year , the company estimated the labor hours for the upcoming year at 35,000 . The estimated variable manufacturing overhead was $ 7.25 per labor hour and the estimated total fixed manufacturing overhead was $ 585,000 . The actual labor hours for the year turned out to be 33,000 . ================================================== ACCT 505 Final Exam Guide ( New ) Set 1
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