Problem 65. Swish Company produces magic swishers. It uses units as the allocati
ID: 2451669 • Letter: P
Question
Problem 65. Swish Company produces magic swishers. It uses units as the allocation basis for overhead. The following information was provided concerning its standard cost system for 2018:
Standard Data
Actual Data
Material
1/2 lb. @ $15.00 per lb.
Produced
2,030 units
Labor
1.2 hrs. @ $12 per hr.
Materials purchased
1,050 lbs. for $14,700
Budgeted fixed overhead
$62,000
Materials used
1,080 lbs.
Budgeted variable overhead
$8.50 per unit
Labor worked
2,500 hrs. costing $29,375
Budgeted production
2,000 units
Actual overhead
$61,700 fixed; $22,400 variable
A. How much is the fixed MOH rate?
B. How much is total MOH applied during 2018?
C. Calculate the standard cost of swishers.
Standard Data
Actual Data
Material
1/2 lb. @ $15.00 per lb.
Produced
2,030 units
Labor
1.2 hrs. @ $12 per hr.
Materials purchased
1,050 lbs. for $14,700
Budgeted fixed overhead
$62,000
Materials used
1,080 lbs.
Budgeted variable overhead
$8.50 per unit
Labor worked
2,500 hrs. costing $29,375
Budgeted production
2,000 units
Actual overhead
$61,700 fixed; $22,400 variable
Explanation / Answer
A. How much is the fixed MOH rate? Fixed MOH = (Fixed Overheads+Variable Overheads)/No. of units Fixed MOH Rate per unit = (62000+2000*8.5)/2000 39.5 $ per unit B. How much is total MOH applied during 2018? Total MOH Applied (Actuals) = Total Overheads/Actual No. of units produced Total MOH Applied per unit = (61,700 + 22,400) / 2,030 41.4 $ per unit C. Calculate the standard cost of swishers. Standard Cost of Swishers $ Material Cost (based on info) 15000 2000 X 1/2 X 15 Labour Cost (based on info) 28800 2000 X 1.2 X 12 Fixed Overheads 62000 Variable Overheads @ $ 8.5 17000 Total Standard Cost 122800 Standard Cost per swisher 61.4 $ per unit