Homework Help This preview shows page 3 out of 3 pages. 11. Provide two reasons why overhead might be underapplied in a given year. Get answer to your question and much more 12. What adjustment to cost of goods sold is made for underapplied overhead? What adjustment ismade for overapplied overhead? Get answer to your question and much more 13. What is a plantwide overhead rate? Why are multiple overhead rates, rather than a plantwideoverhead rate, used in some companies? Get answer to your question and much more 14. What happens to overhead rates based on direct labor when automated equipment replaces directlabor? Get answer to your question and much more
End of preview. Want to read all 3 pages? Upload your study docs or become a Course Hero member to access this document Tags overhead rate, Spoorthy Rajana  Get the answer to your homework problem. Try Numerade free for 7 days We don’t have your requested question, but here is a suggested video that might help. Related QuestionWhat happens to hours of work when the wage rate falls? Decompose the change in hours of work into income and substitution effects. DiscussionYou must be signed in to discuss. Video TranscriptWhen the wage rate falls, what happens to hours of work well, when the wage falls, we can expect workers to work for more hours to reach the desired and expected pay. Numerade has step-by-step video solutions, matched directly to more than +2,000 textbooks. What happens to overhead rates based on direct labor when automated equipment replaces direct labor? Students who’ve seen this question also like: Related Accounting Q&AFind answers to questions asked by students like you. Q: How have advances in manufacturing technology affected overhead application? A: Overhead application: It is a process of allocating the cost to the jobs, the allocation of cost is… Q: What is a plantwide overhead rate? Why are multiple overhead rates, rather than a plantwide overhead… A: Plant-wide overhead rate is the single rate used for overhead absorption for product costing. It is… Q: What is a plantwide overhead rate? Why are multiple overhead rates, rather than a plantwide overhead… A: Plantwide overhead rate is a single overhead rate which is used by the company to allocate it's… Q: Why do businesses apply overhead to tasks using fixed rates rather than real manufacturing overhead… A: This question deals with real manufacturing overhead costs: Q: Explain the benefits of using a predetermined overhead rate instead of an actual overhead rate. A: Click to see the answer Q: Why do companies use predetermined rather than actual manufacturing overhead rates? A: Manufacturing overhead means indirect costs that are incurred for manufacturing of products and… Q: why are departmental overhead rates more accurate for product costing than a plantwide overhead… A: Overhead rate is the total overhead expense incurred over some level of production activity. It… Q: How much is the amount charged to factory overhead control? A: P 315000 will be charged to Factory Overhead Control. Q: What is a plantwide overhead rate? Why are multiple overhead rates, rather than a plantwideoverhead… A: Plant-wide overhead rate refers to the computation of one single overhead recovery rate for the… Q: What is a plantwide overhead rate? Why are multiple overhead rates, rather than a plantwideoverhead… A: Plantwide overhead rate: Plantwide overhead rate refers to a single overhead rate used to allocate… Q: Explain why the fixed manufacturing overhead cost per unit changes when there is a change in the… A: Manufacturing overhead costs: "The costs, which do not relate directly with the manufacturing of… Q: Why factory overhead is computed based on direct labor? A: Refer Step 2 for explanation Q: Why do companies use predetermined overhead rates rather than actual manufacturing overheadcosts to… A: Click to see the answer Q: Why do companies use predetermined overhead rates rather than actual manufacturing overheadcosts to… A: If actual manufacturing overheads are applied then costs are unknown. if calculated need to wait… Q: Please explain:: What is the purpose of an overhead rate What are the steps to apply the overhead… A: Requirement 1: The overhead rate is used to allocate the indirect cost to the direct costs being… Q: In what way does the accounting treatment of factory overhead differ from that of direct materials… A: Factory overhead is defined as cost incurred during the process of manufacturing but not including… Q: What is Over-Absorption of Fixed Overhead? A: Over Absorption of fixed Overhead Over absorption of overhead is define as when actual overhead… Q: Which of the following would not be an element of factory overhead? A: Factory Overhead are not direct cost like direct materials and direct labor however they are helpful… Q: Why do companies use predetermined overhead rates rather than actual manufacturing overhead costs to… A: If actual manufacturing overheads are applied then costs are unknown. if calculated need to wait… Q: Why do companies use predetermined overhead rates rather than actual manufacturing overhead costs to… A: If actual manufacturing overheads are applied then costs are unknown. if calculated need to wait… Q: What is plantwide overhead rate? Why are multiple overhead rates, rather than a plantwide rate, used… A: Overheads are considered as fixed and common expenses that should be allocated to the products on… Q: How much is the amount of over- or underapplied overhead? A: Overheads:- Overheads are the costs like labor, raw material etc that are incurred by the companies… Q: Why is industrial overhead calculated using direct labor A: This question explains about industrial overhead that which is using direct labor: Q: Why are some manufacturing firms switching from direct-labor hours to machine hours or throughput… A: Direct labor: Direct labor includes the wages of the employees who are directly involved in… Q: What does the following statement mean? “Accounting for overhead involves an important costbenefit… A: Overheads are typically accounted by accumulating costs and dividing the total costs by the total… Q: Overhead needs to be allocated only to "jobs" but not to "processes A: Overheads represents expenditure on labour,materials that cant be economically identified with… Q: What makes these overhead costs and what cost driver should be used to apply the overhead costs to… A: Firstly the meaning of the Manufacturing overheads is all indirect cost incurred for production… Q: Why is using a single plantwide overhead allocation rate not always accurate? A: Single plant wide rate: Single plant-wide rate is the traditional method that is used to allocate… Q: Why is using a single plantwide overhead allocation rate not always accurate? A: Single plant wide rate: Single plant-wide rate is the traditional method that is used to allocate… Q: Which of the following statements about using a plantwide overhead rate based on direct labor is… A: Plantwide overhead rate based on direct labour means overhead rate to be calculated which is based… Q: Explain fixed manufacturing overhead. A: Manufacturing overhead costs: The costs, which do not relate openly with the manufacturing of… Q: Is there a difference between Job order costing, process costing, variable costing, and absorption… A: Cost Accounting approaches for products and services include absorption costing and variable… Q: Explain manufacturing overhead costs. A: Manufacturing overheads costs refer to the amount of cost incurred as indirect expenses for… Q: Depreciation of Machinery would not be an element of factory overhead? Select one: O a. True O b.… A: Factory overheads consist of - Factory expenses like factory rente, Factory insurance Energy cost… Q: Research and Development costs are ordinarily considered factory-related overhead costs. True… A: Research & Development (R&D ) are cost that are incurred to obtain new scientific or… Q: What adjustment is made for underapplied overhead on the schedule of CoGS? What adjustment is made… A: Underapplied overhead is added to cost of goods sold thus increases the total cost of goods sold. Q: What is the adjusted balance of work in process inventory after disposing the under- or over-applied… A: Under or overapplied overhead: when a company allocate or apply its overhead cost to production it… Q: Traditional overhead allocations result in which of the following situations? a. Overhead costs… A: The overhead cost under traditional costing is based on single predetermined overhead rate. Q: How much fixed overhead cost is included in ending finished goods inventory under absorption… A: Absorption costing considers the fixed overhead costs for production as per the units sold and not… Q: The application of estimated manufacturing overhead to jobs is: An asset use transaction.… A: Asset use transaction: This is utilization of asset for expense payment or payment towards… Q: Which of the following is NOT an element of manufacturing overhead? Sales manager's salary Plant… A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Knowledge Booster Learn more about Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below. Recommended textbooks for you Managerial Accounting: The Cornerstone of Busines... ISBN:9781337115773 Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger Publisher:Cengage Learning Principles of Accounting Volume 2 ISBN:9781947172609 Author:OpenStax Publisher:OpenStax College Principles of Cost Accounting ISBN:9781305087408 Author:Edward J. Vanderbeck, Maria R. Mitchell Publisher:Cengage Learning College Accounting, Chapters 1-27 ISBN:9781337794756 Author:HEINTZ, James A. Publisher:Cengage Learning, Cornerstones of Cost Management (Cornerstones Ser... ISBN:9781305970663 Author:Don R. Hansen, Maryanne M. Mowen Publisher:Cengage Learning Managerial Accounting: The Cornerstone of Busines... ISBN:9781337115773 Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger Publisher:Cengage Learning Principles of Accounting Volume 2 ISBN:9781947172609 Author:OpenStax Publisher:OpenStax College Principles of Cost Accounting ISBN:9781305087408 Author:Edward J. Vanderbeck, Maria R. Mitchell Publisher:Cengage Learning College Accounting, Chapters 1-27 ISBN:9781337794756 Author:HEINTZ, James A. Publisher:Cengage Learning, Cornerstones of Cost Management (Cornerstones Ser... ISBN:9781305970663 Author:Don R. Hansen, Maryanne M. Mowen Publisher:Cengage Learning What happens to the predetermined overhead rate that is based on direct labor hours when automation equipment replaces direct labor?3-17 When automated equipment replaces direct labor, overhead increases and direct labor decreases. This results in an increase in the predetermined overhead rate—particularly if it is based on direct labor.
What happens to overhead rates based on direct labor when automated equipment and robotics replace direct labor?As a result of machine or equipment replacement, the direct labor will decrease and the overhead will increase. The movement of the overhead and direct labor will increase the predetermined overhead rate due to less movement on the base.
How do you use overhead based on direct labor cost?To calculate the overhead rate, divide the indirect costs by the direct costs and multiply by 100. If your overhead rate is 20%, it means the business spends 20% of its revenue on producing a good or providing services.
Does overhead include direct labor?Direct costs required to create products and services, such as direct labor and materials, are excluded from overhead costs. Businesses have to take into account both overhead costs as well as the direct expenses to calculate the long-term product and service prices.
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What happens to overhead rates based on direct labor when automated equipment replaces direct labor?
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