determine tje per unit factory overhead allocated to the commerical and residential motors under the multiple production department factory overhead rate method, using direct machine hours as the allocation base for each department.

FatakeAssignmentSessionLocator... JO Book angle Plantwide and Multiple Production Department Factory Overhead Rate Methods and Product Cost Distortion Eclipse Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential motor, through two production epartments, Assembly and Testing. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the roducts. However, management is considering using the multiple production department factory overhead rate method. The following factory ove vas budgeted for Eclipse: $280,000 Assembly Department Testing Department 800,000 Total $1,080,000 Direct machine hours were estimated as follows: Assembly Department Testing Department 4,000 hours 5.000 Total 9,000 hours In addition, the direct machine hours (dmh) used to produce a unit of each product in each department were determined from engineering records, as follows: Commercial Residential Assembly Department 2.0 dm 3.0 dmh Testing Dansmont Check My Work 2.0 dmh 3.0 dmh Assembly Department Testing Department Total machine hours per unit 6.0 1.5 8.0 dmh 4.5 dmh a. Determine the per-unit factory overhead allocated to the commercial and residential motors under the single plantwide factory overhead rate method, using direct machine hours as the allocation base. Commercials 960 per unit Residential $ 540 per unit b. Determine the per-unit factory overhead allocated to the commercial and residential motors under the multiple production department factory overhead rate method, using direct machine hours as the allocation base for each department. Commercial $ 96 X per unit Residential per unit c. Recommend to management a product costing approach based on your analyses in (a) and (b). 1. The management should consider multiple production department factory overhead rate methods, because this method calculates the cost more accurately and considers the fact that commercial products use more costly overheads than residential products, 2. The management should consider single plantwide factory overhead rate methods, because this method calculates the cost more accurately and considers the fact that the overheads are applied evenly based on the direct labor hours 2. The management could consider the multiple production department factory overhead rate method or the sole plantelde rates both these methods have the same effect on the final costs Check My Work a