Question $2$ of $4$ Calculate the departmental MOH rates and allocate costs to the two park bench models as if Nash continues to follow its current

two$-$department MOH system. $($Round MOH rates to $2$ decimal places, e$.$g$.15\mathrm{.}25.)$

MOH Applied to Classic Benches

MOH Applied to Modern Benches Current Attempt in Progress

Sarah works for a company that makes and sells vases, and she just completed the preliminary gross margin analysis related to the

recently completed fiscal year. She followed past practice and allocated MOH costs using a plant$-$wide rate based on DL hours. The

company makes two varieties of vases: Sturdy and Delicate.

categories according to common descriptions noted in the accounting system: molding $($driven by DL hours$),$ polishing $($driven by

machine hours$),$ and packaging $($driven by packaging hours$).$ She gathered the following information to assist in her analysis.

$\frac{-}{2\mathrm{.}66}$

Nash Corp. makes many products but is best known for its two styles of park benches: Classic and Modern. Nash initially set up its MOH allocation system to pool all MOH costs into two key departments: Assembly and Finishing. It based Assembly MOH costs on machine hours, and Finishing MOH costs on DL hours. The company understood its costs, set selling prices to cover its costs, and carried on smoothly$-$until now. Nash's president received some phone calls from community members complaining about the bench pricing and reporting that a non$-$community supplier is priced $25\%$ lower than Nash's listed price.

In an effort to better understand its costs, Nash's accountants gathered the following information for the two departments. Then it found more detailed information on key activities within its overhead costs.

$\backslash$table$[[$Departments$,$Budgeted MOH Cost,Budgeted Allocation Base,,Quantity Used by:$],[$Assembly$,$$$675,000,125,000$ machine hours,,$52,000,32,000],[$Finishing$,515,000,50,000$ directlabor hours,$19,000,19,000,],[$Total$,1,190,000,,,,]]$

$\backslash$table$[[$Key Activities,Budgeted MOH Cost,Budgeted Allocation Base,Quantity Used by:$],[$Classic$,$Modern$],[$Materials handling,$$126,000,18,000$ material moves,$3,600,2,700],[$Production setup,$203,000,7,000$ production runs,$2,700,1,900],[$Assembly$,444,000,74,000$ direct labor hours,$19,000,19,000],[$Quality control,$201,000,335,000$ inspections,$36,000,18,000],[$Factory depreciation,$216,000,432,000$ square feet of space,$152,000,87,000],[$Total$,$$$1,190,000,,,]]$