E4-7 Calculating Traditional Overhead Rates, Assigning Costs [LO 4-1]

Bluefield Corp. has two product lines, A and B. Bluefield has identified the following information about its overhead and potential cost drivers:

Total overhead $ 112,500 Cost drivers Number of labor hours 2,500 Number of machine hours 59,800

Required : 1.

Suppose Bluefield Corp. uses a traditional costing system with number of labor hours as the cost driver. Determine the amount of overhead assigned to each product line if Product A requires 70 percent of the labor hours and Product B requires 30 percent.

	Overhead Assigned
Product A
Product B

2.

Suppose Bluefield uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line if Product A consumes 22,100 machine hours and Product B consumes 37,700. (Round intermediate calculations to 2 decimal places and your final answers to the nearest whole dollar amount.)

	Overhead Assigned
Product A
Product B