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Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to
Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours. Painting Dept. Finishing Dept. Overhead $233,100 Direct Labor Hours (dih) Product A Product B 10,500 dih 12 dih 4 dih 73,500 7,200 5 19 Totals $306,600 17,700 dih 17 dih 23 dih The factory overhead allocated per unit of Product B in the Painting Department if Blue Ridge Marketing Inc. uses the multiple production department factory overhead rate method is Oa. $22.20 per unit Ob. $69.25 per unit Oc. $40.83 per unit Od. $88.80 per unit
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