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# Exercises 11-1, 11-2, 11-7 & 11-15and Problems 11-2AProblem

### Customer Question

Exercises 11-1, 11-2, 11-7 & 11-15and Problems 11-2A
Problem 11-2A
The management of Spring Meadow Dairy Company, described in Problem 11- 1A, now plans to use the multiple production department factory overhead rate method. The total factory overhead associated with each department is as follows:
Blending Department \$216,000
Packing Department 54,000
Total &n bsp; \$270,000
Instructions;
1. Determine the multiple production department factory overhead rates, using machine hours for the Blending Department and direct labor hours for the packing Department.
2. Determine the product factory overhead costs, using the multiple production department Rates (1)
Note Problem 11-1A to help the information for problem 11-2A:
Spring Meadow Dairy Company manufactures three products –whole milk, skim milk, and cream- in two production departments, blending the packing. The factory overhead for Spring Meadow is \$270,000
The three products consume both machine hours in the two production departments as follows:
Direct Labor Hours Machine Hours
Blending Department
Whole milk 270 790
Skim milk 290 720
Cream 240 290
800 1,800

Packing Department
Whole milk 330 460
Skim milk 520 560
cream 150 180
1,000 1,200
total 1,800 3,000

EX 11- 15The management of Kitchen Kraft Appliance Company in exercise 11-14 has asked you to use activity based costing to allocate factory overhead costs to the two products. You have determined that \$45,000of factory overhead from each of the production department can be associated with setup activity (90,000in total). Company records indicate that blenders required 120 setups, while the toaster oven required only 60 setups. Each product has a production volume of 5,000units
a. Determine the three activity rates (assembly, test and pack, and setup)
Determine the total factory overhead and factory overhead per unit allocated to each product.
Note the information of exercise 11-14 if you need it am (I just need answer for question 11-15)
Kitchen Kraft appliance company manufactures small kitchen appliances. The product line consists of blenders and toaster ovens. Kitchen Kraft presently uses multiple production deep [ardent factory overhead rate method. The factory overhead as follows:
Assembly department 94,000
Test and pack department 64,000
Total &n bsp; \$158,000
The direct labor information for the production of 5,000 units of each product is as follows:
Assembly department Test and pack department
Blender 500dth 1,500dlh
Toaster oven 1,500 500
Total 2,000dth 2,000dlh

Exercise 11-7 the management of Hercules Engines Inc. Manufactures gasoline and diesel engines through two production department, Fabrication and Assembly. Management needs accurate product cost information in order to guide product strategy. Presently, the company uses a single plant wide factory overhead rate for allocating factory overhead to the two products. However management is considering using the multiple production department factory overhead rate method. The following factory overhead was budgeted for power torque
Total &n bsp; \$800,000
Direct labor hours were estimated as follows:
Fabrication Department 4,000 hours
Assembly department ; 4,000
Total &n bsp; 8,000 hours
In addition, the direct labor hours (Ditch) used to produce unit of each product in each department were determined from engendering recurs as follows:
Production department Gasoline Engine Diesel Engine
Fabrication Department 0.8 dlh 2.2dlh
Assembly department 2.2 0.8
Direct labor hours per unit 3.0 dlh 3.0 dlh

a. determine the per unit factory overhead allocated to the gasoline and diesel engines under the single plantwide factory overhead rate method, using direct labor hours as activity base
b. Determine the per unit factory overhead allocated to the gasoline and diesel engines under the multiple production department factory overhead rate method, using direct labor hours as the activity base for each department.
C. recommended to management a product costing approach, based on your analyses in (a) and (b) support your recommendation.

Ex 11-2 River city Band instruments Inc. Makes three musical instruments , trumpets, tubas, and trombones. The budgeted factory overhead cost is \$140,220. Factory overhead is allocated to the three products on the basis of direct labor hours. The product have the following budgeted production volume and direct labor hours per unit.
Budgeted production volume Direct labor hours per unit
Trumpets 2,500 units 0.5
Tubas 800 1.4
trombones 1,200 1.1

a. determine the single planwide factory overhead rate
b. use the factory overhead rate in( a) determine the amount of total and per unit factory overhead allocated to each of the three products

Ex 11-1 Spacely Sprocket and Gear company’s fabrication Department incurred \$150,000 of factory overhead cost in producing gears and sprockets. The two products consumed a total of 5,000 direct machine hours. Of that amount, sprockets consumed 2,200 direct machine hours.
Determine the total amount of factory overhead that should be allocated to sprockets.

Textbook
Managerial Accounting, 10th Edition
Carl S. Warren, University of Georgia
James M. Reeve, University of Tennessee
Jonathan E. Duchac, Wake Forest University
ISBN: 0-324-66382-X
Submitted: 7 years ago.
Category: Homework
Expert:  Falak Naz replied 7 years ago.
Customer: replied 7 years ago.
My deadline is wednesday up to 12 midnight
Customer: replied 7 years ago.
I just want konw if you will start answer my questions. Let me know if you will answer them today
Expert:  Falak Naz replied 7 years ago.

AIWAIS,

UNFORTUNATELY YOU HAVE A VERY TIGHT DEADLINE AND THE ASSIGNMENT REQUIRE SOME TIME TO COMPLETE SO I AM OPTING OUT

Customer: replied 7 years ago.

Exercises 11-1, 11-2, 11-7 & 11-15and Problems 11-2A

Problem 11-2A

The management of Spring Meadow Dairy Company, described in Problem 11- 1A, now plans to use the multiple production department factory overhead rate method. The total factory overhead associated with each department is as follows:

Blending Department \$216,000

Packing Department 54,000

Total \$270,000

Instructions;

1. Determine the multiple production department factory overhead rates, using machine hours for the Blending Department and direct labor hours for the packing Department.

2. Determine the product factory overhead costs, using the multiple production department Rates (1)

Note Problem 11-1A to help the information for problem 11-2A:

Spring Meadow Dairy Company manufactures three products -whole milk, skim milk, and cream- in two production departments, blending the packing. The factory overhead for Spring Meadow is \$270,000

The three products consume both machine hours in the two production departments as follows:

 Direct Labor Hours Machine Hours Blending Department Whole milk 270 790 Skim milk 290 720 Cream 240 290 800 1,800 Packing Department Whole milk 330 460 Skim milk 520 560 cream 150 180 1,000 1,200 total 1,800 3,000

EX 11- 15The management of Kitchen Kraft Appliance Company in exercise 11-14 has asked you to use activity based costing to allocate factory overhead costs to the two products. You have determined that \$45,000of factory overhead from each of the production department can be associated with setup activity (90,000in total). Company records indicate that blenders required 120 setups, while the toaster oven required only 60 setups. Each product has a production volume of 5,000units

a. Determine the three activity rates (assembly, test and pack, and setup)

Determine the total factory overhead and factory overhead per unit allocated to each product.

Note the information of exercise 11-14 if you need it am (I just need answer for question 11-15)

Kitchen Kraft appliance company manufactures small kitchen appliances. The product line consists of blenders and toaster ovens. Kitchen Kraft presently uses multiple production deep [ardent factory overhead rate method. The factory overhead as follows:

Assembly department 94,000

Test and pack department 64,000

Total \$158,000

The direct labor information for the production of 5,000 units of each product is as follows:

 Assembly department Test and pack department Blender 500dth 1,500dlh Toaster oven 1,500 500 Total 2,000dth 2,000dlh

Exercise 11-7 the management of Hercules Engines Inc. Manufactures gasoline and diesel engines through two production department, Fabrication and Assembly. Management needs accurate product cost information in order to guide product strategy. Presently, the company uses a single plant wide factory overhead rate for allocating factory overhead to the two products. However management is considering using the multiple production department factory overhead rate method. The following factory overhead was budgeted for power torque

Total \$800,000

Direct labor hours were estimated as follows:

Fabrication Department 4,000 hours

Assembly department 4,000

Total 8,000 hours

In addition, the direct labor hours (Ditch) used to produce unit of each product in each department were determined from engendering recurs as follows:

 Production department Gasoline Engine Diesel Engine Fabrication Department 0.8 dlh 2.2dlh Assembly department 2.2 0.8 Direct labor hours per unit 3.0 dlh 3.0 dlh

a. determine the per unit factory overhead allocated to the gasoline and diesel engines under the single plantwide factory overhead rate method, using direct labor hours as activity base

b. Determine the per unit factory overhead allocated to the gasoline and diesel engines under the multiple production department factory overhead rate method, using direct labor hours as the activity base for each department.

C. recommended to management a product costing approach, based on your analyses in (a) and (b) support your recommendation.

Ex 11-2 River city Band instruments Inc. Makes three musical instruments , trumpets, tubas, and trombones. The budgeted factory overhead cost is \$140,220. Factory overhead is allocated to the three products on the basis of direct labor hours. The product have the following budgeted production volume and direct labor hours per unit.

 Budgeted production volume Direct labor hours per unit Trumpets 2,500 units 0.5 Tubas 800 1.4 trombones 1,200 1.1

a. determine the single planwide factory overhead rate

b. use the factory overhead rate in( a) determine the amount of total and per unit factory overhead allocated to each of the three products

Ex 11-1 Spacely Sprocket and Gear company's fabrication Department incurred \$150,000 of factory overhead cost in producing gears and sprockets. The two products consumed a total of 5,000 direct machine hours. Of that amount, sprockets consumed 2,200 direct machine hours.

Determine the total amount of factory overhead that should be allocated to sprockets.

Textbook

Managerial Accounting, 10th Edition
Carl S. Warren, University of Georgia
James M. Reeve, University of Tennessee
Jonathan E. Duchac, Wake Forest University
ISBN: 0-324-66382-X