Bugaboo Co. manufactures three types of cookies: Fluffs, Crinkles, and Snaps. The production process is relatively simple,

Question:

Bugaboo Co. manufactures three types of cookies: Fluffs, Crinkles, and Snaps. The production process is relatively simple, and factory overhead costs are allocated to products using a single plantwide factory rate based on direct labor hours. Information for the month of May, Bugaboo's first month of operations, follows:
Budgeted Unit Volume Direct Labor Hours per unit Fluffs 80,000 boxes 60,000 boxes 0.10 Crinkles 0.20 Snaps 20,000 boxes

Bugaboo has budgeted direct labor costs for May at S8.50 per hour. Budgeted direct materials costs for May are: Fluffs, 50.75/unit:
Crinkles 50.40/unit; and Snaps 50.30/unit.
Bugaboo's budgeted overhead costs for May are:

Indirect Labor $280,000 Utilities S65,000 Supplies $45,000 Depreciation $30,000 Total $420,000

Assume that Bugaboo sells all the boxes it produces in May. Round your answers to two decimal places, if necessary.
a. Compute Bugaboo's plant wide factory overhead rate for May.
$............. per direct labor hour
b. Compute May's product cost for each type of cookie.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question
Question Posted: