Horgen Corporation manufactures two products: Product M68B and Product H27T. The company is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products M68B and H27T.
Activity Cost Pool Activity Measure Total Cost Total Activity
Machining Machine-hours $299,000 13,000 MHs
Machine setups Number of setups $240,000 400 setups
Product design Number of products $80,000 2 products
Order size Direct labor-hours $290,000 10,000 DLHs
Activity Measure Product Product
Machine-hours M68B H27T
Number of setups 6,000 7,000
Number of products 250 150
Direct labor-hours 4,000 6,000
Using the ABC system, how much total manufacturing overhead cost would be assigned to Product H27T?
a. $291,000
b. $174,000
c. S465,000
d. $454,500
Exercise 15-6 Recording events in job order costing LO P1, P2, P3, P4 Prepare summary journal entries to record the following transactions for a company in its first month of operations. Raw materials purchased on account, $94,000. Direct materials used in production, $40,500. Indirect materials used in production, $25,000. Paid cash for factory payroll, $70,000. Of this total, $50,000 is for direct labor and $20,000 is for indirect labor. Paid cash for other actual overhead costs, $7,875. Applied overhead at the rate of 125% of direct labor cost. Transferred cost of jobs completed to finished goods, $74,000. Sold jobs on account for $105,000 g (2). The jobs had a cost of $74,000 g (1).
Economists in Funlandia, which has a closed economy, have collected the following information about the economy for a particular year:
Y = 12,500
C = 9,000
T = 2,100
G = 2,200
The economists also estimate that the investment function is:
I = 2,000-100r
where r is the country's real interest rate, expressed as a percentage.
Calculate private saving, public saving, national saving, investment and equilibrium real interest rate.
