Single plantwide factory overhead rate OBJ. 2 Salty Sensations Snacks Company manufactures three types of snack foods:
Question:
Single plantwide factory overhead rate OBJ. 2 Salty Sensations Snacks Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period:
Factory depreciation $ 31,360 Indirect labor 78,400 Factory electricity 7,840 Indirect materials 35,400 Selling expenses 25,000 Administrative expenses 18,000 _______ Total costs $196,000 _______ _______ Factory overhead is allocated to the three products on the basis of processing hours.
The products had the following production budget and processing hours per case:
Budgeted Processing Hours Volume (Cases) per Case Tortilla chips 4,000 0.20 Potato chips 5,000 0.15 Pretzels 2,500 0.40 _______ Total 11,500 _______ _______
a. Determine the single plantwide factory overhead rate.
b. Use the factory overhead rate in
(a) to determine the amount of total and per-case factory overhead allocated to each of the three products under generally accepted accounting principles.
Step by Step Answer:
Financial And Managerial Accounting
ISBN: 9781305267831,9781305267848
13th Edition
Authors: Carl S. Warren , James M. Reeve , Jonathan Duchac