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Luthor Corporation has a central materials laboratory. The laboratory has only two users, the Large Plane Department and the Small Plane Department. The following data
Luthor Corporation has a central materials laboratory. The laboratory has only two users, the Large Plane Department and the Small Plane Department. The following data apply to the coming budget year: Budgeted costs of operating the materials laboratory for 100,000 to 200,000 technician hours per year: Fixed costs per year $6,000,000 Variable costs $80 per technician hour Budgeted long-run usage in hours per year: Large Plane Department 90,000 technician hours Small Plane Department 70,000 technician hours Practical capacity 200,000 units Practical capacity is used to calculate the allocation rates. Actual usage for the year by the Large Plane Department was 60,000 technician hours and by the Small Plane Department was 65,000 technician hours. If a single-rate cost-allocation method is used, what is the allocation rate per hour used
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