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Posted: June 15th, 2022
The Clash Company uses normal costing. The company has one service department (machine
The Clash Company uses normal costing. The company has one service department (machinemaintenance), and two manufacturing departments (P1 and P2). The service department allocates prices tothe manufacturing department based mostly on machine hours. The company allocates service prices utilizing whatthe guide calls the twin price technique. In different phrases, the company DOES make a distinction betweenfixed and variable prices when charging service prices to the consumer departments. Each of the productiondepartments use direct labor hours as their foundation for computing predetermined overhead charges.MachineMaintenanceBudgeted variable value$98,000Budgeted mounted value$140,000Budgeted machine hoursLong run avg. mach. Hrs.Budgeted variable OH costBudgeted mounted OH costBudgeted direct labor hrs.Precise variable prices$110,000Precise mounted prices$143,000Precise machine hoursActual variable OH costActual mounted OH costActual direct labor hoursDepartment P1Department P28,000 hours10,000 hours$132,300$215,00030,000 hours12,000 hours15,000 hours$108,100$139,10040,000 hours8,500 hours$130,000$212,00031,000 hours13,500 hours$110,000$140,00042,000 hoursThe departmental overhead numbers within the above tables do NOT have the companies prices added intothem.1. Compute the predetermined overhead price for P1. Spherical your price to the closest cent, ifneeded.2. On the finish of the yr, compute the overall quantity of underallocated or overallocated overhead inDepartment P1, and inform whether or not it’s underallocated or overallocated.This quiz is price 5 factors and is due subsequent Monday, April 18 th, by four:00 in my workplace.
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