Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Main Street Ice Cream Company uses a plantwide allocation method to allocate overhead based on direct labor-hours at a rate of $2 per labor-hour. Strawberry

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Main Street Ice Cream Company uses a plantwide allocation method to allocate overhead based on direct labor-hours at a rate of $2 per labor-hour. Strawberry and vanilla flavors are produced in Department SV. Chocolate is produced in Department C. Sven manages Department SV and Charlene manages Department C. The product costs (per thousand gallons) follow, Strawberry Vanilla Chocolate Direct labor (per 1.000 gallons) $759 $ 834 $1,134 Raw materials (per 1,000 gallons) 509 609 829 Required: a. If the number of hours of labor per 1,000 gallons is 65 for strawberry. 70 for vanilla, and 120 for chocolate, compute the total cost of 1.000 gallons of each flavor using plantwide allocation b. Charlene's department uses older, outdated machines. She believes that her department is being allocated some of the overhead of Department SV, which recently bought state-of-the-art machines. After she requested that overhead costs be broken down by department, the following information was discovered: Overhead Machine-hours Labor-hours Department sv $91,044 25,290 25,290 Departnent C $ 3,720 36,900 18,600 Using machine-hours as the department allocation base for Department SV and labor hours as the department allocation base for Department C. compute the allocation rate for each c. Compute the cost of 1.000 gallons of each flavor of ice cream using the department allocation rates computed in requirement(b) if the number of machine-hours for 1.000 gallons of each of the three flavors of ice cream are as follows: strawberry, 65; vanilla, 70, and chocolate, 159. Direct labor-hours by product remain the same as in requirement (a). Using machine-hours as the department allocation base for Department SV and labor-hours as the department allocation base for Department C, compute the allocation rate for each. c. Compute the cost of 1,000 gallons of each flavor of ice cream using the department allocation rates computed in requirement (b) if the number of machine-hours for 1000 gallons of each of the three flavors of ice cream are as follows: strawberry, 65; vanilla, 70, and chocolate, 159. Direct labor-hours by product remain the same as in requirement (a). Complete this question by entering your answers in the tabs below. Required A Required B Required If the number of hours of labor per 1,000 gallons is 65 for strawberry, 70 for vanilla, and 120 for chocolate, compute the total cost of 1,000 gallons of each flavor using plantwide allocation. Total Cost Strawberry Vanilla Chocolate Required Required > Uverhead Machine-hours Labor-hours $91,644 25,290 25,290 $ 3,720 36,900 18,600 Using machine-hours as the department allocation base for Department SV and labor-hours as the department allocation base for Department C, compute the allocation rate for each. c. Compute the cost of 1,000 gallons of each flavor of ice cream using the department allocation rates computed in requirement (b) if the number of machine-hours for 1000 gallons of each of the three flavors of ice cream are as follows: strawberry, 65; vanilla, 70; and chocolate, 159. Direct labor-hours by product remain the same as in requirement (a). Complete this question by entering your answers in the tabs below. Required A Required B Required Using machine-hours as the department allocation base for Department SV and labor-hours as the department allocation base for Department C, compute the allocation rate for each. (Round your answers to 2 decimal places.) Allocation Rate Department SV per machine hour Department per labor hour Required A Required c> Uvernead Machine-hours Labor-hours $91,044 25, 290 25, 290 $ 3,720 36,900 18,600 Using machine hours as the department allocation base for Department SV and labor-hours as the department allocation base for Department C, compute the allocation rate for each c. Compute the cost of 1,000 gallons of each flavor of ice cream using the department allocation rates computed in requirement (b) if the number of machine-hours for 1,000 gallons of each of the three flavors of ice cream are as follows: strawberry, 65; vanilla, 70; and chocolate, 159. Direct labor-hours by product remain the same as in requirement (a). Complete this question by entering your answers in the tabs below. Required A Required B Reqldred c Compute the cost of 1,000 gallons of each flavor of ice cream using the department allocation rates computed in requirement (b) if the number of machine-hours for 1,000 gallons of each of the three flavors of ice cream are as follows: strawberry, 65; vanilla, 70; and chocolate, 159. Direct labor-hours by product remain the same as in requirement (a). Total Cost Strawberry Vanilla Chocolate

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

3. What should a contract of employment contain?

Answered: 1 week ago

Question

1. What does the term employment relationship mean?

Answered: 1 week ago