Cost Accounting (15th Edition)
Cost Accounting (15th Edition)
15th Edition
ISBN: 9780133428704
Author: Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
Question
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Chapter 5, Problem 5.28E

1.

To determine

To calculate: The total overhead allocated to each job under a simple costing system allocated based on machine hours.

Given information:

Machine hours of Job 215 are 40 hours.

Machine hours of Job 325 are 60 hours.

Total budgeted overheads are $226,800.

Total machine hours are 10,500 hours

2.

To determine

To calculate: The total overhead allocated to each job under the activity based coating system.

Given information:

Total budgeted packaging overheads are $19,950.

Total number of units produced is 3,800.

Total budgeted purchasing overheads are $35,000.

Total number of purchase orders processed is 2,000.

Total budgeted material handling overheads are $43,750.

Total material moves are 5,000.

Total budgeted machine maintenance overheads are $118,650.

Total machine hours are 10,500.

Total budgeted product inspection overheads are $9,450.

Total number of inspections is 1,200.

3.

To determine

To explain: The reason of preferring the ABC system over Simple costing system.

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