8 Problem 6-55 (Static) Two-Stage Allocation and Product Costing (LO 6-5) Donovan & Parents produces soccer shorts and jerseys for youth leagues. Most of the production is done by machine. Data on operations and costs for March follow Jerseys 32,eee 6,eee 1,200 $96,000 $32,80e Shorts Units produced Machine-hours used Direct labor-hours Direct materials costs Direct labor costs Manufacturing overhead 16,000 4,800 728 $64,eee $19,200 Total 48,eee 10,800 1,920 $160,00e $52,eee costs $266,400 Management asks the firm's cost accountant to compute product costs. The accountant first assigns overhead costs to two pools: overhead related to direct materials and overhead related to machine-hours. The analysis of overhead accounts by the cost accountant follows. Account Amount Related to: Machine Utilities $ 48,eee hours Supplies Machine depreciation and 33,60e Materials Machine- 1e5,6ee maintenance hours Purchasing and storing materials 38,400 Materials Machine- Miscellaneous 40, 8ee hours
Oo ere to search 8 Required: a. Compute the predetermined overhead rates assuming that Donovan uses machine-hours to allocate machine-related overhead costs and materials costs to allocate materials-related overhead costs. b. Compute the total costs of production and the cost per unit for each of the two products for March. Complete this question by entering your answers in the tabs below. Required A Required B Compute the predetermined overhead rates assuming that Donovan uses machine-hours to allocate machine-related overhead costs and materials costs to allocate materials-related overhead costs. (Enter "Materials related overhead" as a whole percentage (i.e., 32).) Overhead Rate Machine-hour related per hour % Materials related Required A Required B ere to search