Question
Orange County Chrome Company manufactures three chrome-plated productsautomobile bumpers, valve covers, and wheels. These products are manufactured in two production departments (Stamping and Plating). The
Orange County Chrome Company manufactures three chrome-plated productsautomobile bumpers, valve covers, and wheels. These products are manufactured in two production departments (Stamping and Plating). The factory overhead for Orange County Chrome is $220,800. The three products consume both machine hours and direct labor hours in the two production departments as follows: Direct Labor Hours Machine Hours Stamping Department Automobile bumpers 560 800 Valve covers 300 560 Wheels 340 600 1,200 1,960 Plating Department Automobile bumpers 170 1,170 Valve covers 180 710 Wheels 175 760 525 2,640 Total 1,725 4,600 The management of Orange County Chrome Company now plans to use the multiple production department factory overhead rate method. The total factory overhead associated with each department is as follows: 1 Stamping Department $115,200.00 2 Plating Department 105,600.00 3 Total $220,800.00 Required: 1. Determine the multiple production department factory overhead rates, using direct labor hours for the Stamping Department and machine hours for the Plating Department. 2. Determine the product factory overhead costs, using the multiple production department rates in (1).
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