Multiple Production Department Factory Overhead Rates

The total factory overhead for Urban Styles, Inc. is budgeted for the year at $756,000, divided into two departments: Cutting, $540,000, and Sewing, $216,000. Urban Styles manufactures two types of men's pants: jeans and khakis. The jeans require one direct labor hour in Cutting and one direct labor hour in Sewing. The khakis require two direct labor hours in Cutting and two direct labor hours in Sewing. Each product is budgeted for 8,000 units of production for the year.

When required, round all per unit answers to the nearest cent.

a. Determine the total number of budgeted direct labor hours for the year in each department.

Cutting	direct labor hours
Sewing	direct labor hours

b. Determine the departmental factory overhead rates for both departments.

Cutting	$ per dlh
Sewing	$ per dlh

c. Determine the factory overhead allocated per unit for each product using the department factory overhead allocation rates.

Jeans	$ per pair of jeans
Khakis	$ per pair of khakis