Pioria Products Assigns Overhead to Specific Jobs Based on Machine

question 53

Essay

Pioria Products assigns overhead to specific jobs based on machine hours.At the beginning of the current year,estimated overhead costs were $2 150 000 and estimated machine hours were 500 000.By the end of the year,actual overhead costs were calculated to be $1 900 000 and actual machine hours were 475 000.
Required:
A. Calculate the predetermined overhead rate.
B. How much overhead would be applied to a particular job that required 315 machine hours?
C. How much total overhead was applied during the year?
D. By how much was overhead over- or underapplied for the year? Be sure to indicate whether it was over- or underapplied.

Calculate variable and fixed selling, and administrative expenses to prepare a comprehensive expense budget.

Estimate the financial position at the end of a period in terms of accounts receivable, accounts payable, and inventory balances.

Analyze the effects of depreciation and other non-cash expenses on budgeting.

Prepare and analyze the budgeted income statement components like gross margin, net operating income, and net income.

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Definitions:

Owner's Equity

The residual interest in the assets of an entity after deducting liabilities.

Liabilities

Financial obligations or debts that a company owes to external parties or entities.

Assets

Assets are resources owned or controlled by a business, expected to bring future economic benefits.

Total Assets

The sum of all resources owned by a company, valued at cost, which are expected to provide future economic benefits.