ACC$102$ Test $2$ Bonus

The Cake Company produces two products. The following information is available:

Product $1$ Product $2$

Direct Materials $$600$ $$750$

Direct Labor $$1,400$ $$2,200$

Units produced $800400$

The company$$s overhead costs are $$1,800$

Required:

$1.$ Assuming the company allocates overhead on the basis of labor cost, compute the overhead and total production cost for both products.

$2.$ Assuming the company allocates overhead on the basis of units produced, compute the overhead and total production cost for both products.

$1.$ Allocation rate using labor cost:

Allocation Rate

$==\_\_\_\_\_\_$Per Labor $

Expected Costs Product $1$ Product $2$ Total

Direct Materials

Direct Labor

Allocated Overhead

Total Cost

$2.$ Allocation rate using units produced:

Allocation Rate

$==\_\_\_\_\_\_\_\_\_$Per Unit

Expected Costs Product A Product B Total

Direct Materials

Direct Labor

Allocated Overhead

Total Cost