Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
The Malcolm Company uses a standard cost system in which manufacturing overhead costs
are applied to products on the basis of standard direct labor-hours (DLHs). The standards call
for 3 hours of direct labor per unit produced. The following data pertain to the company’s
manufacturing overhead for the month of July:
65. The Fixed component of the predetermined overhead rate for June is:
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
10A–45
66. The volume variance for July is:
The Hawkins Company uses a standard costing system in which manufacturing overhead is
applied on the basis of standard direct labor-hours (DLHs). During February, the company
actually used 9,200 direct labor-hours and made 2,900 units of finished product. The standard
cost card for one unit of product includes the following:
Variable factory overhead: 3 DLHs @ $4.75 per DLH
Fixed factory overhead: 3 DLHs @ $3.00 per DLH
For February, the company incurred $28,450 in fixed manufacturing overhead costs and
recorded a $900 favorable volume variance.
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
67. The amount of fixed manufacturing overhead cost contained in the company’s budget for
February is:
68. The denominator activity level in direct labor-hours used by Hawkins in setting the
predetermined overhead rate for February is:
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
The Steff Company has the following flexible budget (in condensed form) for manufacturing
overhead:
The following data concerning production pertain to last year’s operations:
69. The variable element of the predetermined overhead rate was (per DLH):
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
70. The fixed element of the predetermined overhead rate was (per DLH):
71. The fixed manufacturing overhead cost applied to work in process was:
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
72. The fixed manufacturing overhead budget variance was:
73. The volume variance was:
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
A furniture manufacturer has a standard costing system based on standard direct labor-hours
(DLHs) as the measure of activity. Data from the company’s flexible budget for
manufacturing overhead are given below:
The following data pertain to operations for the most recent period:
74. What is the predetermined overhead rate to the nearest cent?
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
75. How much overhead was applied to products during the period to the nearest dollar?
76. What was the fixed manufacturing overhead budget variance for the period to the nearest
dollar?
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
10A–52
77. What was the fixed manufacturing overhead volume variance for the period to the nearest
dollar?
A manufacturer of playground equipment uses a standard costing system in which standard
machine-hours (MHs) is the measure of activity. Data from the company’s flexible budget for
manufacturing overhead are given below:
The following data pertain to operations for the most recent period:
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
78. What is the predetermined fixed manufacturing overhead rate to the nearest cent?
79. How much fixed manufacturing overhead was applied to products during the period to the
nearest dollar?
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
80. What was the fixed manufacturing overhead budget variance for the period to the nearest
dollar?
81. What was the fixed manufacturing overhead volume variance for the period to the nearest
dollar?
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
The Chase Company has a standard cost system in which manufacturing overhead is applied
on the basis of standard direct labor-hours (DLHs). The company recorded the following
activity and cost data relating to manufacturing overhead for October:
82. The amount of fixed manufacturing overhead cost that was estimated for September was:
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
83. The amount of fixed manufacturing overhead cost applied to work in process during
September was:
84. The fixed manufacturing overhead budget variance for September was:
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
A manufacturer of industrial equipment has a standard costing system based on standard
direct labor-hours (DLHs) as the measure of activity. Data from the company’s flexible budget
for manufacturing overhead are given below:
The following data pertain to operations for the most recent period:
85. What is the predetermined overhead rate to the nearest cent?
Chapter 10 Appendix A Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System
86. How much overhead was applied to products during the period to the nearest dollar?
87. If the denominator level of activity is 6,900 machine-hours, the variable element in the
predetermined overhead rate would be: