Accounting -cost accounting problem solve

Feb 3rd, 2012
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Ashford University
Course: business studies
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Answer to question no: 1 Perry Products 1) The weighted average direct manufacturing Labor Rate should be used in preparing manufacturing direct labor cost is $8.61 Detailed calculation is given below Labor Category Labor Rate Projected Labor Hours Weights Weighted Rate Team Leader $14.50 250 0.05 $0.72 Assembly $8.20 2,000 0.40 $3.28 Answer to question no: 2 Far-Out Products 1) Using the simple average $41 Material Dollar expended per Labor Hour as Cost Estimating Relationship (CER) recommended by the auditors, estimated material cost of the task stands at $ 73,800 Detailed calculation is given below Estimated Materials Dollars Expended per unit labor $41 Proposed Labor Hours 1,800 Estimated Material Costs (41*1800) $73,800

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-Answer to question no: 1 Perry Products1) The weighted average direct manufacturing Labor Rate should be used in preparing manufacturing direct labor cost is $8.61Detailed calculation is given belowLabor CategoryLabor RateProjected Labor HoursWeightsWeighted RateTeam Leader$14.502500.05$0.72Assembly$8.202,0000.40$3.28Fabrication$7.501,5000.30$2.25Production$9.007500.15$1.35QC/Test$10.005000.10$1.00Total5,0001.008.61So the weighted average direct manufacturing labor rate is $8.612) Direct manufacturing Labor cost objective for the contract should be $43,025.00Detailed calculation is given belowLabor CategoryLabor RateProjected Labor HoursLabor Rate * Projected Labor HoursTeam Leader$14.50250$3,625Assembly$8.202,000416,400Fabrication$7.501,500$11,250Production$9.00750$6,750QC/Test$10.00500$5,000Total5,000$43,025Alternatively Direct manufacturing Labor cost objective = weighted average direct manufacturing Labor Rate* Projected Labor Hours=$8.61*5000=$43,025Answer to question no: 2 Far-Out Products1) Using the simple average $41 Material Dollar expended per Labor Hour as Cost Estimating Relationship (CER) recommended by the auditors, estimated material cost of the task stands at $ 73,800Detailed calculation is given belowEstimated Materials Dollars Expended per unit labor$41 Proposed Labor Hours1,800 Estimated Material Costs (41*1800)$73,800 2) Using the CER

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