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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
Actual costing, normal costing, accounting for manufacturing overhead. Destin Products uses a job-costing system with two direct-cost categories (direct materials and direct manufacturing labor) and one manufacturing overhead cost pool. Destin allocates manufacturing overhead costs using direct manufacturing labor costs. Destin provides the following information:
| Â |
Budget for 2011 |
Actual Results for 2011 |
|
Direct material costs |
$2,000,000 |
$1,900,000 |
|
Direct manufacturing labor costs |
1,500,000 |
1,450,000 |
|
Manufacturing overhead costs |
2,700,000 |
2,755,000 |
1. Compute the actual and budgeted manufacturing overhead rates for 2011.
2. During March, the job-cost record for Job 626 contained the following information:
|
Direct materials used |
$40,000 |
|
Direct manufacturing labor costs |
$30,000 |
Compute the cost of Job 626 using (a) actual costing and (b) normal costing.
3. At the end of 2011, compute the under- or over allocated manufacturing overhead under normal costing. Why is there no under- or over allocated overhead under actual costing?
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