CH 06 complete solutions correct answers key

CH 06 complete solutions correct answers key

Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:

Basic

Dominator

Total

  Units produced

800

450

1,250

  Machine-hours

3,400

1,500

4,900

  Direct labor-hours

2,600

1,800

4,400

  Direct materials costs

$

11,100

$

3,600

$

14,700

  Direct labor costs

55,800

32,100

87,900

  Manufacturing overhead costs

156,640

       Total costs

$

259,240

Required:

Compute the predetermined overhead rate assuming that Tiger Furnishings uses direct labor-hours to allocate overhead costs. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)

  Predetermined overhead rate

$ 

  per direct labor hour

Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:

Basic

Dominator

Total

  Units produced

1,000

450

1,450

  Machine-hours

3,900

2,800

6,700

  Direct labor-hours

3,500

1,500

5,000

  Direct materials costs

$

11,900

$

3,400

$

15,300

  Direct labor costs

64,500

32,400

96,900

  Manufacturing overhead costs

175,100

       Total costs

$

287,300

Required:

Compute the predetermined overhead rate assuming that Tiger Furnishings uses direct labor costs to allocate overhead costs. (Round your answer to 2 decimal places. Omit the "%" sign in your response.)

  Predetermined overhead rate

 %

  of direct labor cost

Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:

Basic

Dominator

Total

  Units produced

850

300

1,150

  Machine-hours

3,400

1,800

5,200

  Direct labor-hours

2,900

2,900

5,800

  Direct materials costs

$

9,100

$

3,950

$

13,050

  Direct labor costs

56,300

36,400

92,700

  Manufacturing overhead costs

152,360

       Total costs

$

258,110

Required:

Compute the predetermined overhead rate assuming that Tiger Furnishings uses machine-hours to allocate overhead costs. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)

  Predetermined overhead rate

$ 

  per machine-hour

Basic

Dominator

Total

  Units produced

850

300

1,150

  Machine-hours

3,400

1,800

5,200

  Direct labor-hours

2,900

2,900

5,800

  Direct materials

$

9,100

$

3,950

$

13,050

  Direct labor

56,300

36,400

92,700

  Manufacturing overhead

152,360

  Total costs

$

258,110

  Predetermined Overhead Rate:

       Total overhead

$

152,360

       ÷ Machine-hours

÷

5,200

=

$

29.30

Owl-Eye Radiologists (OR) does various types of diagnostic imaging. Radiologists perform tests using sophisticated equipment. OR's management wants to compute the costs of performing tests for two different types of patients: those who are hospitalized (including those in emergency rooms) and those who are not hospitalized but are referred by physicians. The data for June for the two categories of patients follow.

Hospital Patients

Other Patients

Total

  Units (i.e., procedures) produced

680

840

1,520

  Equipment-hours used

230

120

350

  Direct labor-hours

460

180

640

  Direct labor costs

$

36,800

$

10,800

$

47,600

  Overhead costs

$

47,750

     The accountant first assigns overhead costs to two pools: overhead related to equipment-hours and overhead related to labor-hours. The analysis of overhead accounts by the cost accountant follows:

  Account

Amount

Related to:

  Utilities

$

4,740

 Equipment-hours

  Supplies

12,690

 Labor-hours

  Indirect labor and supervision

19,310

 Labor-hours

  Equipment depreciation and maintenance

7,560

 Equipment-hours

  Miscellaneous

3,450

 Equipment-hours

Required:

(a)

Compute the predetermined overhead rates assuming that Owl-Eye Radiologists uses equipment-hours to allocate equipment-related overhead costs and labor-hours to allocate labor-related overhead costs. (Omit the "$" sign in your response.)

Overhead rate

  Equipment-related overhead

$ 

 per hour  

  Labor-related overhead

$ 

 per hour  

(b)

Compute the total costs of production and the cost per unit for each of the two types of patients undergoing tests in June. (Round your cost per unit to 2 decimal places. Omit the "$" sign in your response.)

Hospital Patients

Other Patients

  Total cost

$      

$     

  Cost per unit

$      

$