- BUS FPX 4064 Assessment 2 Applying Cost Accounting Concepts to Analyze and Estimate Costs.
Applying Cost Accounting Concepts to Analyze and Estimate Costs
Product and Service Costing
6-52 Two-Stage Allocation and Product Costing
Call-Related Overhead Rate:
- Total Call-Related Costs: $200,000
- Total Number of Calls: 20,000 (Tourist) + 12,000 (Premier) = 32,000
- Call-Related Overhead Rate: $200,000 / 32,000 = $6.25
Call Minute-Related Overhead Rate:
- Total Call Minute-Related Costs: $121,500
- Total Call Minutes: 108,000 (Tourist) + 162,000 (Premier) = 270,000
- Call Minute-Related Overhead Rate: $121,500 / 270,000 = $0.45
Total Call Center Costs Allocated:
To Tourist Package:
- (20,000 calls * $6.25) + (108,000 minutes * $0.45)
= $125,000 + $48,600 = $173,600
To Premier Package:
- (12,000 calls * $6.25) + (162,000 minutes * $0.45)
= $75,000 + $72,900 = $147,900
Operations Costing
6-57 Cost Estimation for RV Models (Piper Recreational Vehicles)
Materials Cost:
- XC-2: 54 * $40,000 = $2,160,000
- XC-6: 39 * $70,000 = $2,730,000
- Total Materials Cost: $4,890,000
Conversion Cost:
- $905,550 + $735,120 + $633,180 = $2,273,850
Allocation of Conversion Costs:
- XC-2: ($2,273,850 * $2,160,000 / $4,890,000) = $1,004,400
- XC-6: ($2,273,850 * $2,730,000 / $4,890,000) = $1,269,450
Total Costs per Model:
- XC-2: $2,160,000 + $1,004,400 = $3,164,400
- XC-6: $2,730,000 + $1,269,450 = $3,999,450
Job Costing
7-55 Analysis of Overhead Using Predetermined Rate
Predetermined Overhead Rate:
- Overhead = $576,000 + $384,000 = $960,000
- Direct Materials = $400,000
- Predetermined Rate = $960,000 / $400,000 = 2.4 or 240%
- (Given: Use 225% for calculations below)
Job WM-52 Total Cost:
- Direct Labor: 900 * $22 = $19,800
- Overhead: $11,300 * 225% = $25,425
- Total Cost: $13,500 (DM) + $11,300 (MOH) + $19,800 + $25,425 = $70,025
Job WM-54 Overhead Applied:
- $6,400 * 225% = $14,400
Total Overhead Applied in May:
- Total Direct Materials: $11,300 + $9,400 + $6,400 = $27,100
- Total Overhead: $27,100 * 225% = $60,975
Actual Factory Overhead:
- Supplies: $1,500
- Indirect Labor: $8,000
- Supervisory Salaries: $9,000
- Factory Facilities: $22,500
- Equipment Costs (Power: $12,000, Repairs: $8,500, Other: $11,500) = $32,000
- Total Overhead: $73,000
Overapplied Overhead Adjustment:
- Add $48,000 to Cost of Goods Sold (not material)
- New Account Balances:
- Work-in-Process Inventory: $19,800
- Finished Goods Inventory: $176,300
- Cost of Goods Sold: $1,803,900 + $48,000 = $1,851,900
- Underapplied Overhead: $0
BUS FPX 4064 Assessment 2 Applying Cost Accounting Concepts to Analyze and Estimate Costs
Service Company Job Costs
7-63 Revenue and Cost Per Client
Revenue:
- Selden Contracting: 270 hrs * $500 = $135,000
- Moenhart Insurance: 170 hrs * $500 = $85,000
- Englewood Medical Center: 230 hrs * $500 = $115,000
- Total Revenue: $335,000
Costs:
- Direct Labor: $83,750
- Overhead: $53,600
- M&A Expenses: $57,000
- Total COGS: $137,350
- Net Income: $335,000 – $137,350 – $57,000 = $140,650
Process Cost Accounting
8-49 Production Cost Report (FIFO Method)
Equivalent Units:
- Transferred-In Costs: 75,000 (Completed) + 16,800 (Ending WIP) = 91,800 units
- Conversion Costs: 75,000 + 16,800 − 2,600 = 89,200 units
Cost Per Equivalent Unit:
- Transferred-In: $82,500 / 91,800 = $0.898
- Conversion: $53,060 / 89,200 = $0.595
Completed Units:
- Transferred-In: 75,000 * $0.898 = $67,350
- Conversion: 75,000 * $0.595 = $44,625
Ending WIP (13,000 units):
- Transferred-In: 13,000 * $0.898 = $11,674
- Conversion: 13,000 * $0.595 = $7,735