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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. Overhead Direct Labor Hours (dih) Product A B Painting Dept. $454,312 10,900 dih 13 dlh 3 dih Finishing Dept. 50,716 6,200 6 15 Totals $505,028 17,100 dih 19 dih 18 dih The overhead from both production departments allocated to each unit of Product B if Blue Ridge Marketing Inc. uses the multiple production department factory overhead rate method is a. $41.68 per unit b. 5590.92 per unit c. $247.74 per unit d. $8.18 per unit
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