Part 1: Job Costing Crandall Corporation makes portable enclosures for festivals, concerts, and other events.Its products aren’t mass produced—each unit is made to customer specifications. Crandallemp

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Part 1: Job Costing

Crandall Confirmation makes movable enclosures for festivals, concerts, and other events.Its consequences aren’t magnitude produced—each ace is made to customer specifications. Crandallemploys a typical job requireing scheme. Trodden strive at the association is enriched at a rebukeof $21 per hour; besides, employees accept no pay when they aren’t set-on-footed on jobs. Apredetermined rebuke installed on trodden strive-hours is used to adduce manufacturing aloft to jobs.

In the spent two years, the association runred manufacturing aloft requires (adjusted forprice-level changes using popular prices and wage rebukes) as follows:

Year 1

Year 2

Direct strive-hours worked

144,000

118,000

Manufacturing aloft requires runred:

Introdden strive

$4,580,000

$5,603,340

Employee benefits

2,204,000

3,134,000

Supplies

858,000

1,367,400

Power

620,000

987,420

Heat and light

244,000

210,870

Supervision

598,000

721,970

Depreciation

2,370,000

2,370,000

Property taxes and insurance

945,000

945,000

Total manufacturing aloft requires

$12,419,000

$15,340,000

© PENN FOSTER, INC. 2017 COST ACCOUNTING PAGE 2Graded Project

At the set-on-foot of Year 3, Crandall has two jobs not yet delivered to customers. Job AT-360 was adequated on December 15, Year 2. It’s scheduled to ship out on January 21, Year 3. Job AT-365 is quiet in movement. The predetermined rebuke in Year 2 was $155 per trodden strive-hour.Data on trodden symbolical requires and trodden strive-hours for these jobs in Year 2 was as follows:

During Year 3, Crandall runred trodden symbolical requires and trodden strive-hours for all jobsworked in Year 3, including the bearing of Job AT-365, as follows:

To estimate the predetermined aloft rebuke, Crandall uses the antecedent year’s objective over-head rebuke. At the end of Year 3, three jobs had not been shipped. Postulates on these jobs is asfollows:

  1. What was the sum in the prelude High Goods and prelude Work-in-Process totalitys for Year 3?

  2. Crandall runred trodden symbolicals requires of $210,000 and used an subjoined 800hours in Year 3 to adequate Job AT-365. What was the latest (total) require teeming to Job AT-365?

  3. What was the overapplied or underapplied aloft for Year 3?

  4. Crandall prorates any overapplied or underapplied aloft to Require of Goods Sold, High Goods Inventory, and Work-in-Process Inventory. Prepare a |justly formatted record commencement to prorebuke the Overapplied or UnderappliedOverhead congenial in accomplishment. As an allocation cause, use the trodden strivehours in each totality from Year 3.

  5. A customer requested that Crandall bid on a job to be high in Year 4. Crandallhas estimated that the job conciliate insist almost $156,000 in trodden symbolicals and 8,000 trodden strive-hours. Due to the situation of the administration, Crandall believes insist for its services conciliate be adown medium in Year 4, and the CEO thereforewould relish to bid aggressively, but doesn’t nonformation to expose coin on the scheme.Crandall estimated essentially no sales or professional requires conjoined after a while thisjob. What is the stint sum the association can bid on the job and not run a detriment? (In manage to accomplish an quality of the changeable member of aloft, use thehigh-low mode.)

© PENN FOSTER, INC. 2017 COST ACCOUNTING PAGE 3Graded Project

Job AT-360

Job AT-365

Direct symbolical requires

$680,000

$947,000

Direct strive-hours

4,800 hours

6,200 hours

Direct symbolical requires

$15,780,000

Direct strive-hours

150,000

Actual manufacturing aloft

$18,609,400

AT-285

AT-288

AT-292

Direct symbolicals

$154,000

$224,500

$112,400

Direct strive-hours

2,600 hours

3,400 hours

7,500 hours

Job status

Finished

Finished

In movement

Part 2: Manner Costing

Intrepid Industries manufactures unfruitful competency used in medical equipment. The association uses the weighted-medium manner requireing mode to totality for formation requires. It produces competency in three incongruous sections: Forming, Sterilization, and Assembling. The forthcoming counsel was reputed for the Assembling Section for the month of June:

Beginning work-in-movement list on June 1 had 250,000 aces made up of the forthcoming:

Amount

Degree of Completion

Prior section requires infectious in from the Forming Department

$387,600

100%

Costs pretended by the Steril-ization Department:

Direct symbolicals

317,200

100%

Direct strive

120,050

40%

Manufacturing aloft

67,100

30%

$504,350

Work in manner, June 1

$891,950

During June, 580,000 aces were infectious in from the Forming Section at a require of $1,870,000. The Assembling Section pretended the forthcoming requires:

Assembling high 480,000 aces and infectious them to the Sterilization Department. At June 30, the estimate of aces in finality work-in-movement list was 350,000. The measure of bearing of work-in-manner list at June 30 was as indicated adown:

  1. Prepare a right formatted (including style) formation require rumor (seeExhibit 8.11 as a pattern rumor) using the weighted-medium mode.

  2. Managementwantstolowerthecostsofmanufacturingtheparts.Ithasestablished the forthcoming per ace targets for this consequence in the Assembling Department: symbolicals,$1.65; strive, $.62; and manufacturing aloft $0.48. Has the consequence achievedmanagement’s require targets in the Assembling Department? Transcribe a imperfect rumor toconduct containing your retort(s).

© PENN FOSTER, INC. 2017 COST ACCOUNTING PAGE 4Graded Project

Direct symbolicals

$974,800

Direct strive

318,600

Manufacturing aloft

202,000

Total requires pretended

$1,495,400

Direct symbolicals

80%

Direct strive

65

Manufacturing aloft

30

C. Prepare a right formatted (including style) formation require rumor (seeExhibit 8.12 as a pattern rumor) using the FIFO mode using the postulates loving in Question A after a while one exception: the prelude trodden symbolicals requires as of June 1listed in work-in-manner should be $315,700 instead of $317,200.

D. Using postulates from the FIFO rumor, transcribe a imperfect rumor to conduct addressingthe issues rich in Question B.

Part 3: Activity-Based Costing

Wayfarer Confirmation is contemplating changing its require scheme to an vital-force-installed requireing scheme and nonproductions to perceive further about the possessions of doing so. The confirmation’s require totalityant has verified three aloft require pools parallel after a while the require drivers associatedafter a while each pool as follows:

The confirmation makes three models of kitchen sinks (Deluxe, Premium, and Standard). The plans for formation for the contiguous year and the trodden requires that accept been budgeted for vital-force by consequence are listed adown:

Cost Pools

Costs

Activity Drivers

Utilities

$5,420,000

180,000 muniment hours

Delivery

5,420,000

10,000 deliveries

Assembly

10,940,000

2,000,000 pounds of symbolical

Products

Deluxe

Premium

Standard

Total trodden requires (symbolical and strive)

$850,000

850,000

850,000

Total muniment-hours

210,000

95,000

154,000

Total deliveries

310

620

480

Total pounds of symbolical

1,800,000

1,200,000

2,600,000

Total trodden strive-hours

12,400

8,500

18,600

Number of aces produced

18,000

12,000

24,000

  1. The popular require totalitying scheme reckoning aloft to consequences on the cause of trodden strive-hours. What ace consequence requires conciliate be reputed for the three consequencesassuming the popular require scheme continues to be used?

  2. What are the require driver rebukes associated after a while the three require pools restricted by therequire totalityant?

  3. What ace consequence requires conciliate be reputed for the three consequences if the ABC scheme suggested by the require totalityant’s categorization of require pools is utilized?


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