Carefeel, a manufacturing company uses a job-costing system. The company plant has a machining department and a finishing department. Carefeel uses normal costing with two direct-cost categories direct materials and direct manufacturing labor and two manufacturing overhead cost pools the machining department with machine hours as the allocation base and the finishing department with direct manufacturing labor costs as the allocation base.
The 2018 budget for the plant is as follows:
Q: PART A
The President is aware that financial accounting focuses on reporting to outside users while managerial accounting focuses on reporting to inside users. As an ongoing process, the company president wants you to perform the following so that the president gets a fair picture of the company.
Q: PART B
The President wants to know the total manufacturing overhead cost allocated for job 225. During the month of March, the job-cost record for Job 225 shows the following:
Q: PART C
The president is thinking of decentralizing the departments of his company because he believes that decentralization of operations may lead to better managing each department of the company and therefore seeks your expertise on the matter.
Q: PART D
The Carefeel company books of accounts at the end of 2018 showed the following: