ACC 311 Module 4 Problem Set 1-3
Question 1 of 13 > 4/4 =
Monty Co. produces magnetized clips that its customers use to hang items on their refrigerator doors. In its effort to manufacture
these clips, Monty incurred the following costs this year (amounts are in thousands).
(a)
Your Answer Correct Answer
v Your answer is correct.
Complete the table below by classifying each cost as either a product cost or a period cost; for product costs, further classify as a
direct cost or an indirect cost. (Select NA if not applicable.)
Product Direct
Cost Amount or Period or Indirect
Plastic material and springs for clips $333 Product v Direct v
CEO’s salary 123 Period Vv NA v
Advertising 38 Period Vv NA v
B
Research and development 28 Period Vv NA v
Wages for factory workers 433 Product v Direct v
Utility costs in plant 80 Product v Indirect v
Plant supervisor salaries 199 | Product V' I Indirect VI
Depreciation of plant assets 67 l Product V' l Indirect V]
Salaries and commissions to salespeople 218 r Period VI [
—
Z
, Calculate total direct costs and total indirect (MOH) costs. (Enter amounts in thousands.)
Total direct cost $ 766
Totalindirect (MOH) cost ~ $ 346
eTextbook and Media
Solution
Total direct costs: $333 + $433 = $766 (amounts in thousands)
Totalindirect costs: $80+$199 + $67 = $346 (amounts in thousands)
Assume Monty used a budgeted MOH rate to apply MOH costs, and the total cost applied this year is $321,000. How much did
the company under-or overapply for its MOH costs?
MOH costswas | underapplied v‘ by$ I 25000 | -
eTextbook and Media Assistance Used
Solution
The applied overhead of $321,000s less than the actual overhead (indirect costs) of $346,000, so MOH was underapplied
by $25,000.
Question 1 of 13 > 4/4 =
Monty Co. produces magnetized clips that its customers use to hang items on their refrigerator doors. In its effort to manufacture
these clips, Monty incurred the following costs this year (amounts are in thousands).
(a)
Your Answer Correct Answer
v Your answer is correct.
Complete the table below by classifying each cost as either a product cost or a period cost; for product costs, further classify as a
direct cost or an indirect cost. (Select NA if not applicable.)
Product Direct
Cost Amount or Period or Indirect
Plastic material and springs for clips $333 Product v Direct v
CEO’s salary 123 Period Vv NA v
Advertising 38 Period Vv NA v
B
Research and development 28 Period Vv NA v
Wages for factory workers 433 Product v Direct v
Utility costs in plant 80 Product v Indirect v
Plant supervisor salaries 199 | Product V' I Indirect VI
Depreciation of plant assets 67 l Product V' l Indirect V]
Salaries and commissions to salespeople 218 r Period VI [
—
Z
, Calculate total direct costs and total indirect (MOH) costs. (Enter amounts in thousands.)
Total direct cost $ 766
Totalindirect (MOH) cost ~ $ 346
eTextbook and Media
Solution
Total direct costs: $333 + $433 = $766 (amounts in thousands)
Totalindirect costs: $80+$199 + $67 = $346 (amounts in thousands)
Assume Monty used a budgeted MOH rate to apply MOH costs, and the total cost applied this year is $321,000. How much did
the company under-or overapply for its MOH costs?
MOH costswas | underapplied v‘ by$ I 25000 | -
eTextbook and Media Assistance Used
Solution
The applied overhead of $321,000s less than the actual overhead (indirect costs) of $346,000, so MOH was underapplied
by $25,000.
