2. Kaumajet Factory produces two products: table lamps and desk lamps. It has two separate departments: Fabrication and Assembly. The factory overhead budget for the Fabrication Department is $757,666, using 418,600 direct labor hours. The factory overhead budget for the Assembly Department is $294,272, using 60,800 direct labor hours.

If a desk lamp requires 4 hours of fabrication and 7 hours of assembly, the amount of factory overhead that Kaumajet Factory will allocate to each unit of desk lamp using the multiple production department factory overhead rate method with an allocation base of direct labor hours is

a.$17.30

b.$190.31

c.$4.84

d.$41.12

4. Ramapo Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and Assembly. Data for the products and departments are listed below.

Product	Number of Units	Direct Labor Hours Per Unit	Machine Hours Per Unit
Blinks	1,025	1	5
Dinks	2,265	6	9

All of the machine hours take place in the Fabrication department, which has an estimated overhead of $81,600. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $93,100.

Ramapo Company uses a single plantwide overhead rate to apply all factory overhead costs based on direct labor hours. The factory overhead allocated per unit of Blinks is

a.$77.89

b.$11.95

c.$71.72

d.$93.11

5. Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.

	Activity Cost		Activity Base
Procurement	$395,500		Number of purchase orders
Scheduling	238,200		Number of production orders
Materials handling	486,900		Number of moves
Product development	733,100		Number of engineering changes
Production	1,468,000		Machine hours

	Number of Purchase Orders	Number of Production Orders	Number of Moves	Number of Engineering Changes	Machine Hours	Number of Units
Disk drives	3,930	260	1,420	10	1,900	2,400
Tape drives	1,600	135	580	8	9,100	3,800
Wire drives	12,900	890	4,200	25	10,300	2,200

The activity-based cost for each wire drive unit is

a.$867.15

b.$21.46

c.$227.29

d.$228.55

9. Challenger Factory produces two similar products: regular widgets and deluxe widgets. The total factory overhead budget is $625,500 with 367,700 estimated direct labor hours. Deluxe widget production requires 2 direct labor hours for each unit, and regular widget production requires 3 direct labor hours for each unit.

Using a single plantwide factory overhead rate with an allocation base of direct labor hours, the factory overhead that Challenger Factory will allocate to deluxe widget production if budgeted production for the period for deluxe widgets is 43,400 units and actual production of deluxe widgets for the period is 58,000 units would be

a.$197,200

b.$276,856

c.$369,142

d.$110,743

10. Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication and Assembly. Data for the products and departments are listed below.

Product	Number of Units	Direct Labor Hours Per Unit	Machine Hours Per Unit
Rings	1,010	4	8
Dings	2,060	8	8

All of the machine hours take place in the Fabrication Department, which has estimated total factory overhead of $81,800. All of the labor hours take place in the Assembly Department, which has estimated total factory overhead of $68,500.

Aleutian Company uses the multiple production department factory overhead rate method. The Fabrication Department uses machine hours as an allocation base, and the Assembly Department uses direct labor hours.

The total factory overhead allocated per unit of Dings is

a.$40.00

b.$48.96

c.$53.36

d.$4.08

11. Skagit Company manufactures Hooks and Nooks. The following shows the activities per product and total activity information:

	Units	Setups	Inspections	Assembly (dlh)
Hooks	4,000	1	3	1
Nooks	8,000	2	2	3

Activity	Total Activity-Base Usage	Budgeted Activity Cost
Setups	20,000	$60,000
Inspections	24,000	120,000
Assembly (dlh)	28,000	420,000

The total factory overhead to be allocated to each unit of Hooks is

a.$50

b.$11

c.$33

d.$61

12. Kaumajet Factory produces two products: table lamps and desk lamps. It has two separate departments: Fabrication and Assembly. The factory overhead budget for the Fabrication Department is $932,331, using 515,100 direct labor hours. The factory overhead budget for the Assembly Department is $498,680, using 72,800 direct labor hours.

If a table lamp requires 5 hours of fabrication and 8 hour of assembly, the total amount of factory overhead that Kaumajet Factory will allocate to table lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours if 5,400 units are produced is

a.$106,139

b.$36,990

c.$170,874

d.$344,790

13. Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.

	Activity Cost		Activity Base
Procurement	$324,500		Number of purchase orders
Scheduling	227,900		Number of production orders
Materials handling	418,600		Number of moves
Product development	744,500		Number of engineering changes
Production	1,478,300		Machine hours

	Number of Purchase Orders	Number of Production Orders	Number of Moves	Number of Engineering Changes	Machine Hours	Number of Units
Disk drives	3,980	300	1,350	10	2,400	2,400
Tape drives	2,100	175	640	8	8,000	4,300
Wire drives	11,600	890	4,200	27	11,500	2,400

The activity rate for the materials handling cost pool is

a.$67.63 per move

b.$18.35 per move

c.$67.5 per move

d.$166.96 per move

14.Challenger Factory produces two similar products: regular widgets and deluxe widgets. The total factory overhead budget is $558,800 with 385,900 estimated direct labor hours. Deluxe widget production requires 3 direct labor hours for each unit, and regular widget production requires 2 direct labor hours for each unit.

Using a single plantwide factory overhead rate with an allocation base of direct labor hours, the factory overhead that Challenger Factory will allocate to regular widget production if budgeted production of regular widgets for the period is 75,000 units and actual production of regular widgets for the period is 128,100 units would be

a.$279,400

b.$556,483

c.$371,490

d.$185,494

15. Kaumajet Factory produces two products: table lamps and desk lamps. It has two separate departments: Fabrication and Assembly. The factory overhead budget for the Fabrication Department is $905,362, using 500,200 direct labor hours. The factory overhead budget for the Assembly Department is $394,912, using 57,400 direct labor hours.

If a table lamp requires 5 hours of fabrication and 8 hour of assembly, the amount of factory overhead that Kaumajet Factory will allocate to each unit of table lamp using the multiple production department factory overhead rate method with an allocation base of direct labor hours is

a.$6.88

b.$22.65

c.$294.46

d.$64.09

18. Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.

	Activity Cost		Activity Base
Procurement	$331,400		Number of purchase orders
Scheduling	236,200		Number of production orders
Materials handling	404,600		Number of moves
Product development	721,800		Number of engineering changes
Production	1,509,200		Machine hours

	Number of Purchase Orders	Number of Production Orders	Number of Moves	Number of Engineering Changes	Machine Hours	Number of Units
Disk drives	4,130	400	1,240	10	2,100	1,800
Tape drives	2,200	175	660	4	8,200	4,000
Wire drives	12,000	820	4,100	29	12,000	2,000

The activity rate for the product development cost pool is

a.$8,393 per engineering change

b.$16,786 per engineering change

c.$75,537 per engineering change

d.$35,251 per engineering change

19. Bonnington Company manufactures small table lamps and desk lamps. The following shows the activities per product:

	Units	Setups	Inspections	Assembly (dlh)
Small table lamps	4,000	4,000	15,000	6,000
Desk lamps	8,000	16,000	7,000	20,000

Using the following information prepared by Bonnington Company, the total factory overhead to be allocated to small table lamps is

Activity	Total Activity-Base Usage	Budgeted Activity Cost
Setups	20,000	$80,000
Inspections	22,000	132,000
Assembly (dlh)	26,000	416,000

a.$314,000

b.$104,000

c.$202,000

d.$209,333

20. Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours.

	Overhead	Direct Labor Hours (dlh)	Product
A	B
Painting Dept.	$595,050		15,000	dlh		16	dlh	7	dlh
Finishing Dept.	52,735		5,300			6		16
Totals	$647,785		20,300	dlh		22	dlh	23	dlh

The overhead from both production departments allocated to each unit of Product B if Blue Ridge Marketing Inc. uses the multiple production department factory overhead rate method is

a.$9.95 per unit

b.$694.42 per unit

c.$39.67 per unit

d.$436.89 per unit