2.3 A furniture company manufactures four products; chairs, office tables, computer tables, and book shelves. Three departments, cutting, painting, and assembly are used in making these products. Direct material cost/unit for chairs, office tables, computer tables, and book shelves is $47, $30, $51, and $65 respectively. Direct labor hours used for each product in all the departments are as follows:

Product

Chair

Office Table Computer Table Book Shelf

Cutting

1.5 0.75 1.3 0.6 1.8 1.0 2.0 1.2

Painting

Assembly

Direct Labor Hours/Unit

25

2.0 1.25 1.85

2.15

Annual overhead for all three departments is $326,750. Direct labor cost for cutting, painting and assembly departments are $16, $12, and $14 per hour respectively. Annual production is chairs, 1500; office tables, 650; computer tables, 1000; book shelves, 1200.

26

(a) Determine total cost of manufacturing a book shelf using direct labor cost for allocation of overhead. ($231.01)

(b) Determine total cost of a computer table using direct labor hours for allocation of overhead.

(c) If a chair is sold for $219.99, determine the profit per chair if direct material cost is used for allocation of overhead.($41.90)

2.3 A furniture company manufactures four products; chairs, office tables, computer tables, and book shelves. Three departments, cutting, painting, and assembly are used in making these products. Direct material cost/unit for chairs, office tables, computer tables, and book shelves is $47, S30, S51, and S65 respectively. Direct labor hours used for each product in all the departments are as follows: Product Direct Labor Hours/Unit Cutting Painting Assembly 1.5 Chair Office Table Computer Table Book Shelf 1.3 0.75 0.6 1.0 2.0 1.25 1.85 2.15 1.8 2.0 1.2 Annual overhead for all three departments is $326,750. Direct labor cost for cutting, painting and assembly departments are $16, $12, and S14 per hour respectively. Annual production is chairs, 1500; office tables, 650; computer tables, 1000; book shelves, 1200. 26 (a) Determine total cost of manufacturing a book shelf using direct labor cost for allocation of overhead. ($231.01) (b) Determine total cost of a computer table using direct labor hours for allocation of overhead used for (c) If a chair is sold for $219.99, determine the profit per chair if direct material cost is allocation of overhead.(41.90)