Problem 3-60 Plantwide versus Departmental Overhead Rates; Product Pricing (LO 3-1, 3-4, 3-7) [The following information applies to the questions displayod below] TeleTech Corporation manufactures two different color printers for the business market. Cost estimates for the two models for the current year are as follows: "The predetermined overhead rate is $20 per direct-labor hour. Each model of printer requires 20 hours of direct labor. The basic system requires 5 hours in department A and 15 hours in department B. The advanced system requires 15 hours in department A and 5 hours in department B. The overhead costs budgeted in these two production departments are as follows: The firm's management expects to operate at a level of 20,000 direct-labor hours in each production department during the current year. (This estimate is based on the practical capacity of each department.) Problem 3-60 Part 2 2. If the firm prices each model of color printer at 10 percent over its cost, what will be the price of each model? [The following information applles to the questions displayed below.] TeleTech Corporation manufactures two different color printers for the business market. Cost estimates for the two models for the current year are as follows: 'The predetermined overhead rate is $20 per direct-labor hour. Each model of printer requires 20 hours of direct labor. The basic system requires 5 hours in department A and 15 hours in department B. The advanced system requires 15 hours in department A and 5 hours in department B. The overhead costs budgeted in these two production departments are as follows: The firm's management expects to operate at a level of 20,000 direct-labor hours in each production department during the current year. (This estimate is based on the practical capacity of each department.) roblem 3-60 Part 3 Suppose the company were to use departmental predetermined overhead rates. Calculate the rate for each of the two producti epartments. Problem 3-60 Plantwide versus Departmental Overhead Rates; Product Pricing (LO 3-1, 3-4, 3-7) [The following information applies to the questions displayed below] TeleTech Corporation manufactures two different color printers for the business market. Cost estimates for the two models for the current year are as follows: 'The predetermined overhead rate is $20 per direct-labor hour. Each model of printer requires 20 hours of direct labor. The basic system requires 5 hours in department A and 15 hours in department B. The advanced system requires 15 hours in department A and 5 hours in department B. The overhead costs budgeted in these two production departments are as follows: The firm's management expects to operate at a level of 20,000 direct-latior hours in each production department during the current year. (This estimate is based on the practical capacity of each department.) Problem 3-60 Part 4 4. Compute the product cost of each model using the departmental overhead rates calculated in requirement 3 . [The following information applies to the questions displayed below] TeleTech Corporation manufactures two different color printers for the business market. Cost estimates for the two models for the current year are as follows: The predetermined overhead rate is $20 per direct-labor hour. Each model of printer requires 20 hours of direct labor. The basic system requires 5 hours in department A and 15 hours in department B. The advanced system requires 15 hours in department A and 5 hours in department B. The overhead costs budgeted in these two production departments are as follows: The firm's management expects to operate at a level of 20,000 direct-tabor hours in each production department during the current year. (This estimate is based on the practical capacity of each department.) Problem 3-60 Part 5 . Compute the price to be charged for each model, assuming the company continues to price each product at 10 percent above cost Jse the revised product costs calculated in requirement 4
