Question
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.
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 (dlh) | Product | |||||||
A | B | ||||||||
Painting Dept. | $248,000 | 10,000 | dlh | 16 | dlh | 4 | dlh | ||
Finishing Dept. | 72,000 | 10,000 | 4 | 16 | |||||
Totals | $320,000 | 20,000 | dlh | 20 | dlh | 20 | dlh |
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
a.$99.20 per unit
b.$64.00 per unit
c.$49.60 per unit
d.$28.80 per unit
2-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 (dlh) | Product | |||||||
A | B | ||||||||
Painting Dept. | $258,800 | 11,900 | dlh | 7 | dlh | 8 | dlh | ||
Finishing Dept. | 76,400 | 10,400 | 5 | 7 | |||||
Totals | $335,200 | 22,300 | dlh | 12 | dlh | 15 | dlh |
Using a single plantwide rate, the factory overhead allocated per unit of Product B is
a.$15.03
b.$225.45
c.$180.36
d.$152.24
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. Direct Product Overhead Labor Hours (dlh) A B Painting Dept. $248,000 10,000 dlh 16 dlh 4 dlh Finishing Dept. 72,000 10,000 4 16 Totals $320,000 20,000 dlh 20 dlh 20 dlh 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. $99.20 per unit Ob. $64.00 per unit Oc. $49.60 per unit Od. $28.80 per unit 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. Direct Product Overhead Labor Hours (dlh) A B Painting Dept. $258,800 11,900 dih 7 dlh 8 dlh Finishing Dept. 76,400 10,400 5 7 Totals $335,200 22,300 dlh 12 dlh 15 dlh Using a single plantwide rate, the factory overhead allocated per unit of Product B is Oa. $15.03 Ob. $225.45 Oc. $180.36 Od. $152.24Step by Step Solution
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