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Donovan & Parents produces soccer shorts and jerseys for youth leagues. Most of the production is done by machine. Data on operations and costs
Donovan & Parents produces soccer shorts and jerseys for youth leagues. Most of the production is done by machine. Data on operations and costs for March follow. Units produced Machine-hours used Direct labor-hours Direct materials costs Jerseys 9,200 990 240 $12,800 Shorts 4,900 Total 14,100 830 110 1,820 350 $8,500 $21,300 Direct labor costs $ 4,800 $2,200 Manufacturing overhead costs $ 7,000 $23,738 Management asks the firm's cost accountant to compute product costs. The accountant first assigns overhead costs to two pools: overhead related to direct materials and overhead related to machine-hours. The analysis of overhead accounts by the cost accountant follows. Account Utilities Supplies Machine depreciation and maintenance Purchasing and storing materials Miscellaneous Amount $ 3,910 Related to: Machine-hours Materials 2,870 10,920 Machine-hours 2,668 Materials 3,320 Machine-hours Required: a. Compute the predetermined overhead rates assuming that Donovan uses machine-hours to allocate machine-related overhead costs and materials costs to allocate materials-related overhead costs. b. Compute the total costs of production and the cost per unit for each of the two products for March Complete this question by entering your answers in the tabs below. Required A Required B Compute the predetermined overhead rates assuming that Donovan uses machine-hours to allocate machine-related overhead costs and materials costs to allocate materials-related overhead costs. (Round "Machine-related overhead rate to 2 decimal places and enter "Materials related overhead" rate as a whole percentage (ie., 32).) Machine-hour related Materials related Overhead Rate per hour %
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