Sparkle Company Produces Ornamental Trees and Uses Normal Costing A Calculate Applied Overhead

question 132

Essay

Sparkle Company produces ornamental trees and uses normal costing.Sparkle applies overhead based on direct labour hours.The following data are provided:
$$\begin{array} { l r r } & \text { Budgeted } & \text { Actual } \\\text { Overhead } & \$ 400,000 & \$ 392,000 \\\text { Machine Hours } & 20,000 & 18,000 \\\text { Direct Labour Hours } & 16,000 & 17,840 \\\text { Direct Materials Cost } & & \$ 521,000 \\\text { Direct Labour Cost } & & \$ 410,000 \\\text { Units Produced } & & 10,000\end{array}$$ A. Calculate applied overhead.
B. Calculate the unit cost.

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Definitions:

Mean

The average of a set of numbers, calculated by dividing the sum of the values by their count.

Standard Deviation

A gauge that evaluates the breadth of fluctuation or spread of dataset values in relation to the central value.

Normally Distributed

This probability distribution is distinguished by its symmetric nature around the mean, showcasing higher frequencies of data points near the mean than those at greater distances.

Mean

The arithmetic average of a set of values or observations, calculated by summing all numbers and then dividing by the count of the numbers.