1/ If one unit of Product Z2 used $3.20 of direct materials and $3.70 of direct

Question

1/ If one unit of Product Z2 used $3.20 of direct materials and $3.70 of direct labor, sold for $10.00, and was assigned overhead at the rate of 37% of direct labor costs, how much gross profit was realized from this sale? (Round your intermediate calculations and final answer to two decimal places.)

Multiple Choice

$6.90.

$1.37.

$3.10.

$1.73.

$10.00.

2/ Copy Center pays an average wage of $13 per hour to employees for printing and copying jobs, and allocates $18 of overhead for each employee hour worked. Materials are assigned to each job according to actual cost. Jobs are marked up 15% above cost to determine the selling price. If Job M-47 used $360 of materials and took 20 hours of labor to complete, what is the selling price of the job?

Multiple Choice

$828.

$1,127.

$1,012.

$713.

$713.

3/ Dallas Company uses a job order costing system. The company's executives estimated that direct labor would be $5,200,000 (200,000 hours at $26/hour) and that factory overhead would be $1,440,000 for the current period. At the end of the period, the records show that there had been 120,000 hours of direct labor and $1,140,000 of actual overhead costs. Using direct labor hours as a base, what was the predetermined overhead rate? (Round your answer to two decimal places.)

Multiple Choice

$6.37 per direct labor hour.

$12.00 per direct labor hour.

$5.70 per direct labor hour.

$7.20 per direct labor hour.

$6.78 per direct labor hour.

4/ Using the following accounts and an overhead rate of 150% of direct labor cost, compute the amount of applied overhead.

Multiple Choice

$90,000.

$82,650.

$59,280.

$148,200.

$88,920.

5/ Andrew Industries purchased $170,000 of raw materials on account during the month of March. The beginning Raw Materials Inventory balance was $23,000, and the materials used to complete jobs during the month were $145,500 of direct materials and $13,500 of indirect materials. What is the ending Raw Materials Inventory balance for March?

Multiple Choice

$47,500.

$12,000.

$34,000.

$24,500.

$9,500.

Work in Process Inventory Beginning WIP 34,900 Direct materials 55,100 Direct labor ? Factory Overhead ? To Finished Goods 213,300 Ending WIP 24,900

Explanation / Answer

Solution:(1): Option(d) is correct i.e. $1.73

Explanation: Gross profit = 10-3.20-3.70-(3.70*37%)

= $1.73/unit

Solution:(2): Option(b) is correct i.e. $1,127

Explanation: Selling price. = [360+(13*20)+(18*20)]*115% = $1,127

Solution:(3): Option(d) is correct i.e. $7.20

Explanation: Predetermined overhead rate = Factory overhead / direct labor hours

= 1,440,000/200,000 = $7.20/direct labor hour

Solution:(4): Option(e) is correct i.e. $88,920

Explanation: 34,900+55,100+DL+OH-213,300=24,900

or, DL+OH = 148,200

or DL + 1.5DL = 148,200

or, 2.5DL = 148,200

DL = 59,280

or, 59,280+OH = 148,200

Therefore, OH = $88,920

Solution:(5): Option(c) is correct i.e. $34,000

Explanation: Ending raw material inventory = Beginning direct raw material + raw material Purchased - raw materials used = 23000+170000-145500-13500 = $34,000

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