Accounting Entries for Manufacturing Overhead Absorption

1 2 3 4 5 7 6 11 10 16 15 14 8 12 9 13 LUCKY NUMBER 17 18

40 60 80 A company operates an intergrated accounting system. (C ng ty ho t ng theo ch k to n t ch h p) What would be the accounting entries for manufacturing overhead over absorbed? ( i u g l b t to n cho chi ph ch t o tr n ph n ti u t n?) (N ) (C ) Debit Credit A B C Overhead control account (T i kho nki m so t chi ph chung) ! Ti c qu . Income statement (B n b o c o thu nh p) Income statement Overhead control account Work in progress account (T i kho ns nxu td dang) ! Ti c qu . Overhead control account Overhead control account Work in progress account ! Ti c qu . D Ch c m ngb n ! BACK SUGGEST BACK CH N A CH N D CH N B CH N C

40 A manufacturing company uses an intergrated accounting system. The production overhead absorption rate is $3 per direct labour hour. Production overhead incurred last period was $85,000 and 27,000 direct labour hours were worked. 60 (C ng ty s nxu tch bi ns d ngch k to n t ch h p. T l ti u t n trong chi ph chung c as nxu t l 3$ m igi lao ngtr cti p. Chi ph chung c as nxu t ph t sinh k n m ngo i l $85,000 v 27,000 lao ngtr cti p l m vi c) 80 What would be the accounting entry to record the under or over absorption of production overhead for the period? ( i u n o l kho n ghi s ghi nh n chi ph chung c n l ic as nxu t trong k ?) Debit Credit $4,000 ! Ti c qu . Overhead control account (T i kho nki m so t chi ph chung) Income statement $4,000 A CH N A (B n b o c o thu nh p) Overhead control account Work in progress account Overhead control account $4,000 Income statement $4,000 B CH N B ! Ti c qu . $4,000 Overhead control account $4,000 ! Ti c qu . C CH N C $4,000 Work in progress account (T i kho nki m so t d dang) $4,000 Ch c m ngb n ! D CH N D BACK SUGGEST BACK

There are two production cost centres and two service cost centres in a factory. Production overheads have been allocated and apportioned to cost centres and now require re-apportionmentfrom service cost centres to production cost centres. Relevant details are: 40 60 80 (C 2 trung t m s nxu t v 2 trung t m d chv trong nh m y. Chi ph chung c as nxu t c ph n ph i v ph n chia nb ph n chi ph v b y gi n c chia ra t ngph nt b ph n chi ph d ch v nb ph n chi ph s nxu t. B ng chi ti tnh sau:) What is the total re- apportionment to Production Cost Centres Y? Service cost (chi ph d chv ) ! Ti c qu . Service cost Centre A (b ph n A) Centre B (b ph n B) Total overhead (t ng CP chung) $42,720 $48,480 $51,120 $56,880 A $42,000 $57,600 ! Ti c qu . B % to Production Cost Centre X (% chi ph s nxu tb ph n X) ! Ti c qu . 40 55 C % to Production Cost Centre Y (% chi ph s nxu tb ph n Y) 60 45 Ch c m ngb n ! D BACK CH N A CH N B CH N C CH N D SUGGEST BACK

40 60 80 What is the term that is used to describe the process of charging an entire expense to a single cost centre? (Thu tng g c d ng m t quy tr nh t nh to n to n b chi ph cho 1 b ph n chi ph ?) Allocation A (ph n b ) ! Ti c qu . Apportionment B (chia ra t ngph n) ! Ti c qu . C Absorption (s p nh p) ! Ti c qu . (chia l nn a) Ch c m ngb n ! D Re-apportionment BACK CH N A CH N B CH N C CH N D SUGGEST BACK

40 60 80 What is the term used to describe the process of sharing an expense amongst a number of cost centres? (Thu tng n o d ng m t qu tr nh chia s chi ph gi a c c b ph n chi ph ?) (ph n b ) Allocation A ! Ti c qu . Apportionment (chia ra t ngph n) B ! Ti c qu . (s p nh p) ! Ti c qu . Absorption C Re-apportionment (chia l nn a) D Ch c m ngb n ! BACK CH N A CH N B CH N C CH N D SUGGEST BACK

40 60 80 A factory has two production cost centres, assembly and finishing, as well as two service cost centres, maintenance and stores. The rent and rates for the next period is anticipated to be $40,000. The floor area occupied by each of the cost centres is: (Nh m y c 2 b ph n chi ph , l p r p v ho n th nh, c ngnh b ph n chi ph d chv , b o tr v h ng t n kho. Ti n thu v t l c ak t i c t nh tr c c $40,000. Di n t ch s n chi m ngc a m ib ph n chi ph l :) CH N A 2,000 m2 1,400 m2 1,000 m2 600 m2 Assembly Finishing Stores Maintenance What amount should be apportioned to the stores cost centre for rent and rates? (L ng ph n chia nb ph n chi ph h ng t n kho khi thu v it l tr n l ) (L p r p) (Ho n th nh) (H ng t n kho) (B o tr ) CH N B ! Ti c qu . CH N C CH N D ! Ti c qu . ! Ti c qu . SUGGEST Ch c m ngb n ! $11,200 $16,000 Nil $8,000 D B C A BACK BACK

40 60 80 In a factory the stores cost centre overheads are to be reapportioned to three production cost centres. What is the most appropriate basis for reapportionment? ( m t nh m y, b ph n chi ph chung s ph n chia n 3 b ph ns nxu t chi ph . C s th ch h pnh t cho s ph n b l i l g ?) A Number of employees per production cost centre (S nh n vi n m ib ph n chi ph s nxu t) ! Ti c qu . B Value of machinery in each production cost centre (Gi tr m y m c trong m ib ph n) C Number of materials requisitions by each cost centre (S v tli u ih ib im ib ph n chi ph ) ! Ti c qu . ! Ti c qu . D Machine hours in each cost centre (S gi m y m c ch y trong m ib ph n) Ch c m ngb n ! BACK CH N A CH N B CH N C CH N D SUGGEST BACK

40 60 80 A factory has two production cost centres, assembly and finishing, as well as two service cost centres, maintenance and stores. After the allocation and apportionment of overheads the following totals have been established: (Nh m y c 2 b ph n chi ph , l p r p v ho n th nh, c ngnh b ph n chi ph d chv , b o tr v h ng t n kho. Sau khi ph n b v chia ra t ngph nc a t ng chi ph chung cl p ra) CH N A Assembly Finishing $ Maintenance $ Stores $ $ CH N B Allocated and apportioned overheads 52,400 41,300 18,590 15,200 CH N C ! Ti c qu . CH N D The maintenance department is estimated to spend 400 hours in the assembly cost centre and 250 hours in the finishing cost centre. The assembly cost centre will make 140 materials requisitions during the next period but the finishing cost centre will only make 60 materials requisitions. What is the total production overhead for the assembly department? (Ph ng b o h nh c t nh tr i qua 400 gi trong b ph nl p r p v 250 gi trong b ph n ho n th nh. B ph nl p r p ih i 140 v tli u trong k t inh ngb ph n ho n th nh s ih i 60 v tli u. T ng chi ph c ab ph nl p r p l ?) $22,080 $52,400 A B ! Ti c qu . ! Ti c qu . Ch c m ngb n ! $53,010 $74,480 D C BACK BACK SUGGEST

40 60 80 A factory has two production cost centres, A and B, and two service cost centre, stores and the canteen. The overheads for each cost centre after allocation and apportionment are as follows. (M t nh m y c 2 b ph ns nxu t, A v B, v 2 b ph nd chv : c c c a h ng v nh n. C c chi ph chung cho t ngb ph n sau khi ph n b nh sau.) Production cost centres (Chi ph b ph ns nxu t) Service cost centres (Chi ph b ph nd chv ) Stores (c a h ng ) Canteen (nh n) CH N A (Ph n b chi ph chung ) A B CH N B $ $ $ $ 21,150 Allocation and CH N C 44,210 38,760 16,280 apportioned overhead CH N D ! Ti c qu . You are also given the following information about cost centres. (B nc ng c cung c p c c th ng tin sau v c c b ph n chi ph .) SUGGEST A 40 B 50 240 BACK BACK Number of employees A ! Ti c qu . $20,580 Number of material requisitions 200 ! Ti c qu . $20,630 B What is the total amount of service cost centre cost be reapportioned to production cost centre B ? $59,340 C Ch c m ngb n ! (T ngs ti n chi ph b ph nd chv c chia ra t ngph n n chi ph s nxu tb ph n B l bao nhi u?) $59,390 D

You are given the following budgeted details about the two production cost centres of a business. (B n ang a ra c c chi ti t ng n s ch sau yv hai b ph n chi ph s nxu tc a doanh nghi p.) 40 60 80 (Ho n th nh) (S nxu t) Manufacturing Finishing (Chi ph qu n l ) Overheads $245,600 $185,400 (Gi lao ng) Labour hours 38,000 88,000 Machine hours (Th i gian s d ng m y) 80,000 20,000 The mannufacturing cost centre is a largely machine based department whereas the finishing cost centre is very much labour based (C c b ph ns nxu t l m tb ph nch y ud a tr n m y m c l ch y u trong khi c c b ph n ho n thi n th c nr tnhi u lao ng) ! Ti c qu . CH N A CH N B What is the overhead absorption rate in the manufacturing cost centre per machine hour (to the nearest cent ) ? (T l s d ng chi ph chung trong s nxu tb ph n chi ph cho m igi m y l bao nhi u? l yg nnh t ) ! Ti c qu . CH N C ! Ti c qu . CH N D $2.11 per machine hour $3.07 per machine hour $6.46 per machine hour $9.27 per machine hour A B Ch c m ngb n ! SUGGEST C D BACK BACK

You are given the following budgeted details about the two production cost centres of a business. (B n ang a ra c c chi ti t ng n s ch sau yv hai b ph n chi ph s nxu tc a doanh nghi p.) 40 60 80 Manufacturing Finishing Overheads $245,600 $185,400 Labour hours 38,000 88,000 Machine hours 80,000 20,000 The mannufacturing cost centre is a largely machine based department whereas the finishing cost centre is very much labour based (C c b ph ns nxu t l m tb ph nch y ud a tr n m y m c l ch y u trong khi c c b ph n ho n thi n th c nr tnhi u lao ng) What is the overheads absorption rate per labour hour in the finishing cost centre ( to the nearest cent )? T l s d ng chi ph cho m igi lao ng trong c c b ph n chi ph ho n thi n l g ? ( l yg nnh t ) ! Ti c qu . CH N A CH N B ! Ti c qu . CH N C ! Ti c qu . CH N D A B $2.11 per machine hour $3.07 per machine hour $6.46 per machine hour $9.27 per machine hour Ch c m ngb n ! SUGGEST D C BACK BACK

40 60 80 One of the products that a factory makes spends 3 machine hours in the assembly department and 2 labour in the packaging department. The overhead absorption rates for each department are as follows. (M t trong nh ngs nph m m m t nh m y l m trong 3 gi m y t i c c b ph nl p r p v 2 lao ng trong c c b ph n ng g i. T l ti u t n chi ph cho t ngb ph nnh sau.) Assembly Packaging $2.66 per machine hour $1.75 per labour hour ( ng g i) ! Ti c qu . (L p r p) ($2.66 cho m igi m y l m) ($1.75 cho m igi lao ng) What is the total amount of overhead to be absorbed into the cost of the product? (T ngs ti nb v o chi ph s nxu tc as nph m l bao nhi u?) ! Ti c qu . $4.41 $8.82 $10.57 $11.48 Ch c m ngb n ! B A ! Ti c qu . D C BACK CH N A CH N B CH N C CH N D SUGGEST BACK

40 60 80 A factory produces a product called the ZZ which has direct material costs per unit of $4.20 and a direct labour cost per unit of $4.65. Each unit of the ZZ spends half an hour in the assembly department and quarter of an hour being packaged. The overhead absorption rates are $4.80 per hour in the assembly department and $3.60 per hour in the packaged department. (M t nh m y s nxu tm ts nph m ZZ trong c chi ph v tli utr c ti p tr n m t nv $ 4,20 v chi ph lao ngtr cti p tr n m t nv $4,65. M i nv c a ZZ d nh n agi trong c c b ph nl p r p v 15 ph t c ng g i. T l ti u t n chi ph l $ 4,80 cho m igi trong c c b ph nl p r p v $ 3,60 cho m igi trong c c b ph n ng g i.) ! Ti c qu . What is the total production cost of one unit of the ZZ? (T ng chi ph s nxu tc am t nv c a ZZ l bao nhi u?) ! Ti c qu . ! Ti c qu . $3.30 $8.40 $8.85 $12.15 B A C D Ch c m ngb n ! BACK CH N A CH N B CH N C CH N D SUGGEST BACK

40 60 80 Consider the following statements. 1. All expenses are overheads 2. Service cost centre overheads should be apportioned to product cost centre (H y xem x t c c ph t bi u sau: 1. M i chi ph l chi ph qu n l 2. C c chi ph d chv chi ph t p trung ph i c ph n b t p trung cho gi th nh s nph m.) ! Ti c qu . Which one of the following is correct with regard to the above statements ? Both are correct A (H y ch nm t p n ng) B Both are incorrect ! Ti c qu . C Statements 1 is correct but statement 2 is incorrect ! Ti c qu . D Statements 1 is incorrect but statement 2 is correct Ch c m ngb n ! BACK CH N A CH N B CH N C CH N D SUGGEST BACK

40 60 80 A business has two production departments, manufacturing and finishing. Details of the overhead absorption rates used in these two departments are as follows: (Doanh nghi p c hai b ph n : s nxu t v ho n thi n. Chi ti tv c c t l ti u t n tr n kh ng cs d ng trong hai b ph n n y nh sau:) Manufacturing overhead absorption rate = $1.47 per machine hour Finishing overhead absorption rate = $ 3.04 per labour hour (T l chi ph s nxu t ti u t n: T l chi ph ho n thi n ti u t n: =$1.47 m igi m y =$3.04 m tgi lao ng) CH N A CH N B One product, the Gant, has the following details. Manufacturing Finishing Labour hour per unit Machine hours per unit M ts nph m, c c c chi ti t sau y. S nxu t Ho n thi n Gi lao ng tr n m im t nv M igi nv m y m c CH N C ! Ti c qu . 4 6 1 2 CH N D SUGGEST ! Ti c qu . BACK 4 6 1 ! Ti c qu . 2 BACK How much total overhead would be included in the cost of one unit of the Gant (to the nearest cent )? A B C D $11.76 $11.90 $11.96 $14.90 Ch c m ngb n ! T ng chi ph s c t nh v o chi ph c am t nv l bao nhi u (l y gi tr g nnh t)?

40 60 80 A factory has two production departments, assembly and packaging. One of the products made in the factory is the Edd. Details of the departments and the Edd are given below. (Doanh nghi p c hai b ph ns nxu t, l p r p v ng g i. M t trong nh ngs n ph ms nxu tt i nh m y l EDD. Th ng tin chi ti tc a c c b ph n v EDD c a ra d i y.) ( ng g i) (L p r p) Assembly Packaging (Chi ph ng n s ch ) Budgeted overhead Budgeted machine hours Budgeted labour hours Edd labour hours per unit $104,300 50,000 25,000 $64,500 10,000 30,000 (Ng n s ch cho m igi m y ) (Ng n s ch cho m igi lao ng) 4 7 3 1 (Edd - gi lao ng tr n m t nv ) (Edd gi m y tr n m t nv ) ! Ti c qu . Edd machine hours per unit Overheads are absorbed on the machine hour basis in the assembly department and on the labour hour basis in the packaging department. (Chi ph chung ti u t n tr n c s m igi m y trong c c b ph nl p r p v tr n c s gi lao ng trong c c b ph n ng g i.) ! Ti c qu . SUGGEST BACK BACK What absorption rates per relevant hours? are the budgeted overhead ! Ti c qu . Assembly Packaging A $4.17 $6.45 (Nh ng t l chi ph chung c ghi v o ng n s ch m i gi li n quan?) B $4.17 $2.15 Ch c m ngb n ! C $2.09 $6.45 D $2.09 $2.15 CH N A CH N B CH N C CH N D

40 60 80 BACK SUGGEST BACK CH N A CH N D CH N B CH N C

40 60 80 BACK SUGGEST BACK CH N A CH N D CH N B CH N C