Question
Salty Sensations Snacks Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the
Salty Sensations Snacks Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period
Factory Depreciation $25888
Indirect Labor $64720
Factory Electricity $6472
Indirect Materials $25020
Selling Expenses $24100
Administrative Expenses 15600
Total Costs $161800
Factory overhead is allocated to the three products on the basis of processing hours. The products had the following production budget and processing hours per case:
Budgeted Volume (case)
Processing Hours Per Case
Tortilla 4000 Per case.15
Potato chips 4700 Per Case .12
Pretzels 2400 Per Case .44
Total 11100 (cases)
A.Determine the single plant wide factory overhead rate
B.Use the factory overhead rate in (a) to determine the amount of total and pre-case factory overhead allocated to each of the three products under generally accepted accounting principles.
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