Please help with the whole question I tried answering as best as I can. Thank yo
ID: 2528520 • Letter: P
Question
Please help with the whole question I tried answering as best as I can. Thank you
Q1 900 Q2 825 Q3 330 Q4 145
The actual direct material cost is
$ 8.00per board. The actual direct manufacturing labor rate is
$ 22 per hour. The budgeted variable manufacturing overhead rate is $ 15 per direct manufacturing labor-hour. Budgeted fixed manufacturing overhead costs
$16,500 each quarter.
Spade Manufacturing produces surfboards. The company uses a normal-costing system and allocates manufacturing overhead on the basis of direct manufacturing labor-hours. Most of the company's production and sales occur in the first and second quarters of the year. The company is in danger of losing one of its larger customers Sobba Wholesale, due to large fluctuations in price. The owner of Spade has requested an analysis of the manufacturing cost per unit in the second and third quarters. You have been provided the following budgeted information for the coming year: EEB (Click the icon to view the budgeted information.) (Click the icon to view additional information.) Read the requirements Requirement 1 and 2. Calculate the total manufacturing cost per unit for the second and third quarter assuming the company allocates manufacturing overhead costs based on the budgeted manufacturing overhead rate determined for each quarter and an annual budgeted manufacturing overhead rate First identify the formula to calculate the total manufacturing cost per unit, then enter the appropriate amounts to calculate the total cost per unit for second and third quarter based on the budgeted manufacturing overhead rate determined for each quarter and an annual budgeted manufacturing overhead rate for the year. (Abbreviation used: OH - overhead, mat.materials, and Var. variable.) Total cost Direct mat. per unitDirect labor per unit+ OH per unit+ Fixed OH per unitper unit 8 15 15 15 20 50 30 65 Qtr 2 Qtr 3 Annual Requirement 3. Spade Manufacturing prices its surfboards at manufacturing cost plus 20%. Why might Sobba wholesale be seeing large fluctuations in the prices of boards? 95 Which of the methods described in requirements 1 and 2 would you recommend Spade use? Explain. Spade should use the budgeted annual manufacturing overhead rate because capacity decisions are based on longer annual periods rather than quarterly periods Prices should not vary based on quarterly fluctuations in productionExplanation / Answer
2)Part 2 is perfectly correct .
3)
Spade should use the budgeted annual overhead rate as capacity decision are based on annual periods rather than quarterly periods .Prices should varybased on quarterly fluctuations in production (as number of units produced vary in each quarters)