Calculation of estimated labor base. The direct labor work force of edwin inc.

consists of 150
employees working full time 8 hours, 5 day a week. Normal capacity assumes that the
equivalent of 48 week of work can be expected a full time employee. Requaired: calculate the
following:

(1) The number of direct labor hours to be used in calculating the factory overhead rate
based on normal capacity
(2) The number od diract labor hours if management and workers agree on a 10 hour, 4 day
workweek

Penyelesaian:

Various Overhead Rates.Nazareth Company estimates overhead of $225,000 for the next
year.An estimated 25,000 units will be produced, with materials cost of $550,00.Conversion
will require an estimated 56,250 direct labor hours at a cost of $8 per hour and an estimated
75,000 machine hours.

Required: Compute the predetermined overhead rate to be used in applying factory overhead to
production on each of the following bases:

(1) Units of production

(2) Materials cost
(3) Direct labor hours
(4) Direct labor cost
(5) Machine hours

Penyelesaian :

estimasi BOP $ 225.000

a. BOP berdasarkan unit produksi = = = $9
estimasi unit produksi 25.000unit
estimasi BOP $ 225.000
b. BOP berdasarkan biaya bahan baku = = = 45%
estimasi biaya ba h an baku $ 500.000
estimasi BOP $ 225.000
c. BOP berdasarkan jam TKL = = = $4
estimasijam TKL 56.250 jam
estimasi BOP $ 225.000
d. BOP berdasarkan biaya TKL = = = 50%
estimasi biaya TKL $ 8 x 56.250
 estimasi BOP $ 225.000
e. BOP berdasarkan jam mesin = = = $3
estimasi jammesin 75.000 mesin

Theoretical capacity for Cybertech Company is 80,000 direct labor hours, and normal
capacity is 50,000 direct labor hours. The actual capacity attained for the fiscal year ended
June 30, 20A, was 43,000 hours. It is estimated that 40,000 hours will be worked in 20B.
Fixed factory overhead is $400,000, and variable factory overhead is $6.69 per direct labor
hour. 
Required: 

(a) Using the normal capacity, compute (a) the factory overhead rate, and (b) the fixed part of
the factory overhead rate.
(b) Using expected actual capacity for 20B, compute (a) the factory overhead rate, and (b) the
fixed part of the factory overhead rate.