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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. Finishing Dept. $242,700 10,900 dih 2 dih 11 dih 64,900 10,900 3 7 Totals $307,600 21,800 dih 5 dih 18 dih Using a single plantwide rate, the factory overhead allocated per unit of Product B is a. 514.11 b. $44.33 $70.55 d. $253.98
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