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Charlie Manufacturing Company has two production departments, Melting and Molding. Direct general plant management and plant security costs benefit both production departments. Charlie allocates general
Charlie Manufacturing Company has two production departments, Melting and Molding. Direct general plant management and plant security costs benefit both production departments. Charlie allocates general plant management costs on the basis of the number of production employees and plant security costs on the basis of space occupied by the production departments using the direct method of overhead allocation. In November, the following overhead costs were recorded:
Melting Department overhead | $ 500,000 |
Molding Department overhead | 400,000 |
General plant management | 200,000 |
Plant security | 100,000 |
Other pertinent data follow:
Melting | Molding | |
---|---|---|
Number of employees | 60 | 40 |
Space occupied (square feet) | 20,000 | 80,000 |
Machine hours | 1,056 | 3,200 |
Direct labor hours | 10,560 | 7,200 |
I need help with part C.
Indirect Cost Allocation: Direct Method Charlie Manufacturing Company has two production departments, Melting and Molding. Direct general plant management and plant security costs benefit both production departments. Charlie allocates general plant management costs on the basis of the number of production employees and plant security costs on the basis of space occupied by the production departments using the direct method of overhead allocation. In November, the following overhead costs were recorded: Melting Department overhead :3 500,000 Molding Department overhead 400,000 General plant management 200,000 Plant security 100,000 Other pertinent data follow: Melting Molding Number of employees 60 40 Space occupied (square feet) 20,000 80,000 Machine hours 1,056 3,200 Direct labor hours 10,560 7,200 (a) Prepare a schedule allocating general plant management costs and plant security costs to the Melting and Molding Departments. Department Total Melting Molding General Plant Management $ 200,000 '1 3 120,000 v 5 80,000 J Plant security 3; 100,000 V 1; 20,000 ol 3; 80,000 V (b) Determine the total departmental overhead costs for the Melting and Molding Departments. Melting $ 640,000 v Molding $ 560,000 V (c) Assuming the Melting Department uses machine hours and the Molding Department uses direct labor hours to apply overhead to production, calculate the overhead rate for each production department. Note: Round nal answers to two decimal places, Melting $ 606.1 x Molding $ 77.78 vStep by Step Solution
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