Hazel Company allocates overhead based on direct labor hours. It allocates overhead costs of $16,200 to two different jobs as follows:
Job 1: (12 hours) = $8,100; Job 2: (12 hours) = $8,100
The production process for Job 2 was then automated. Now Job 2 requires only 3 hours of direct labor but 5 hours of mechanical processing. As a result, total overhead increases to $21,000. Select the incorrect statement from the following.
A. While the actual processing of Job 1 was not affected by automation, it received an increase of $9,900 in its overhead allocation.
B. The use of machine hours as the allocation base would significantly improve the overhead cost allocations.
C. The increased overhead costs associated with automation should be allocated to both jobs.
D. Automation and the costing system used by the company cause the cost of Job 1 to be significantly overstated.

Question

02-04-2021
Business

Answered

Westonci.ca is your go-to source for answers, with a community ready to provide accurate and timely information. Join our platform to get reliable answers to your questions from a knowledgeable community of experts. Connect with a community of professionals ready to provide precise solutions to your questions quickly and accurately.

Hazel Company allocates overhead based on direct labor hours. It allocates overhead costs of $16,200 to two different jobs as follows:
Job 1: (12 hours) = $8,100; Job 2: (12 hours) = $8,100
The production process for Job 2 was then automated. Now Job 2 requires only 3 hours of direct labor but 5 hours of mechanical processing. As a result, total overhead increases to $21,000. Select the incorrect statement from the following.
A. While the actual processing of Job 1 was not affected by automation, it received an increase of $9,900 in its overhead allocation.
B. The use of machine hours as the allocation base would significantly improve the overhead cost allocations.
C. The increased overhead costs associated with automation should be allocated to both jobs.
D. Automation and the costing system used by the company cause the cost of Job 1 to be significantly overstated.

Sagot :

Visit us again for up-to-date and reliable answers. We're always ready to assist you with your informational needs. We appreciate your time. Please come back anytime for the latest information and answers to your questions. Thank you for trusting Westonci.ca. Don't forget to revisit us for more accurate and insightful answers.

find the midpoint of (-4,-5) and (4,1)

HolaPart BIn a brief response, describe two ways that Langston Hughes's "I, Too" is similarto or different from Walt Whitman's "I Hear America Singing." Cite sp

the way to holiness as given to us

In △DEF, what is the length of segment DF? Right triangle DEF with DE measuring 27, angle F measures 60 degrees and angle E measure 90 degrees. 54 18 radica

Which of the following statements are true about Host Pools? A. Pooled Host Pools are not a good choice when the end user requires administrative privileges on

In Mendel's law of segregation, he proposed that "there are two factors controlling a given characteristic ... and these factors separate and go to different ga

To receive clemency from the Convening Authority, the accused may submit a request for clemency___A. During the investigation. B. After the pretrial but before

When a childbirth transition from home-based to hospital based, what is it called?

Going to a hockey game summary

A nurse is preparing a presentation for a local community about hearing loss and prevention. Which of the following would the nurse integrate into the presentat

anthougo anthougo · Answer 1 · 2021-04-04T02:18:41-04:00

Answer:

Hazel Company

The incorrect statement is:

A. While the actual processing of Job 1 was not affected by automation, it received an increase of $9,900 in its overhead allocation.

Explanation:

Option A is the correct answer because Job 1's overhead cannot increase by $9,900. Therefore, this purported increase cannot be verified as correct. Most likely the overhead allocation of Job 1 will decrease since Job 2 has another basis for allocating overhead to it, which Job 1 does not incur. Overhead allocation using ABC system is more efficient than the traditional method of using a predetermined rate because overhead is now allocated based on consumption rather than using some arbitrary basis.

Sagot :

Other Questions