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Applied Overhead and Unit Overhead Cost: Plantwide Rates Seco, Inc., produces two types of clothes dryers: deluxe and regular. Seco uses a plantwide rate based
Applied Overhead and Unit Overhead Cost: Plantwide Rates Seco, Inc., produces two types of clothes dryers: deluxe and regular. Seco uses a plantwide rate based on direct labor hours to assign its overhead costs. The company has the following estimated and actual data for the coming year: Estimated overhead $2,016,000 Expected activity 48,000 Actual activity (direct labor hours): Deluxe dryer 11,000 Regular dryer 37,000 Units produced: Deluxe dryer 22,000 Regular dryer 185,000 Required: 1. Calculate the predetermined plantwide overhead rate, using direct labor hours. per hour Calculate the applied overhead for each product, using direct labor hours. Applied overhead Deluxe Regular 2. Calculate the overhead cost per unit for each product. If required, round your answers to the nearest cent. Overhead Cost Deluxe per unit Regular per unit 3. What if the deluxe product used 22,000 hours (to produce 22,000 units) instead of 11,000 hours (total expected hours remain the same)? Calculate the effect on the profitability of this product line if all 22,000 units are sold. Profits would by $
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