Ask Question
BusinessBusiness
28 February, 23:06

Use the following information for the next four questions. St. James, Inc. currently uses traditional costing procedures, applying $800,000 of overhead to products Beta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-based costing and thecreation of individual cost pools that will use direct labor hours (DLH), production setups (SU), and number of parts components (PC) as cost drivers. Data on the costs pools and respective driver volumes follow: Pool No. 1 Pool No. 2 Pool No. 3Product (Driver: DLH) (Driver: SU) (Driver: PC) Beta 1,200 45 2,250Zeta 2,800 55 750 4,000 DLHs 100 SUs 3,000 PCs Pool Cost $160,000 $280,000 $360,000 1. The overhead cost allocated to Beta by using traditional costing procedures would be: a. $240,000 b. $356,000 c. $444,000 d. $560,000

+1
Answers (1)
  1. 28 February, 23:15
    0
    The correct answer is A.

    Explanation:

    Giving the following information:

    Estimated overhead = $800,000

    Total estimated direct labor hours = 4,000

    Direct labor hours Beta = 1,200

    To calculate the estimated manufacturing overhead rate we need to use the following formula:

    Estimated manufacturing overhead rate = total estimated overhead costs for the period / total amount of allocation base

    Estimated manufacturing overhead rate = 800,000/4,000 = $200 per hour

    Now, we can allocate overhead to Beta:

    Allocated MOH = Estimated manufacturing overhead rate * Actual amount of allocation base

    Allocated MOH = 200*1,200 = $240,000
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Use the following information for the next four questions. St. James, Inc. currently uses traditional costing procedures, applying $800,000 ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Making tax-deferred deposits into a retirement account means that the funds are a. not taxed when deposited but taxed when withdrawn. b. never taxed. c. taxed both when deposited and when withdrawn but not while held in the account. d.
Answers (1)
Assume that the full-employment level of output is $2,000 and the price level associated with full-employment output is 100.
Answers (1)
The subject property does not have a pool or a screen porch. A comparable that sold for $205,000 has a $1,000 screen porch, one more $2,500 half-bathroom, and a $6,000 pool. Assuming all else is equal, what is the adjusted value of the comparable? A.
Answers (1)
In January, Hometown Ice Cream Shoppe reported the following balances in their income statement accounts. Based on this information, the closing entry to Retained Earnings will be?
Answers (1)
New Rock, Inc. sells video games it has purchased from a local distributor. The following static budget is based on sales of 8,000 games. However, New Rock only sold 7,800 games during the year.
Answers (1)
New Questions in Business
An airline company is interested in the opinions of their frequent flyer customers about their proposed new routes. Specifically, they want to know what proportion of them plan to use one of their new hubs in the next 10 months.
Answers (1)
Taylor Bank lends Guarantee Company $92,811 on January 1. Guarantee Company signs a $92,811, 12%, nine-month note. The entry made by Guarantee Company on January 1 to record the proceeds and issuance of the note is
Answers (1)
Why is it important to know the interest rate on your credit card? a) The higher the interest rate, the more money you will be paying back b) The higher the interest rate, the less money you will be paying back c) The lower the interest rate, the
Answers (2)
It is appropriate to use the fixed assets turnover ratio to appraise firms' effectiveness in managing their fixed assets if and only all the firms being compared have the same proportion of fixed assets to total assets. a) trueb) false
Answers (1)
Which of the following actions differentiates an entrepreneur from other small business owners?
Answers (1)
Home » Business » Use the following information for the next four questions. St. James, Inc. currently uses traditional costing procedures, applying $800,000 of overhead to products Beta and Zeta on the basis of direct labor hours.
Sign Up Forgot Password?