Question
Answer the following question correctly. Answer all the parts given below. If you don't know the answer kindly don't solve. Subject name is Cost accounting.
Answer the following question correctly. Answer all the parts given below. If you don't know the answer kindly don't solve.
Subject name is Cost accounting.
Omega Company manufactures a single product. They have two production and two service departments. The following information is provided.
Production department Service department
Machining Assembly Maintenance Canteen
Overheads $143,500 $154,700 $165,800 $176,900
Direct Machine hours 18,845 14,050 0 0
Direct Labor hours 6,065 20,350 0 0
The service department overhead is apportioned to the production department on following basis.
Machining Assembly Canteen
Maintenance 60% 30% 10%
Canteen 40% 60%
Required:
- Prepare overhead absorption table showing the reapportionment of service department costs.
- Based on apportionment calculate overhead rate for each production department.
- Calculate per unit cost for the single product if material cost is 3 meters @ $4 per meter and labor is 7 hours @$8 per hour. For machining department overhead is 3 hours and for assembly department it is 4 hours.
- Determine the selling price of the product if the above cost per unit is 100% plus 25% is markup.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started