Single Plantwide and Multiple Production Department Factory Overhead Rate Methods and Product Cost Distortion The management of Nova Industries Inc, manufactures gasoline and diesel engines through two production departments, Fabrication and Assembly. Management needs accurate product cost informabion in order to guide product strategy. Presently, the company uses a single plantwide factory overtiead rate for allocating factory overhead to the two products. Howevec, management is considering the multiple production department foctory overhead rate method. The following factory overhead was budgeted for Nova: Direct labor hours were estimated as follows: In addition, the direct labor hours (dih) used to produce a unit of each product in each department were determined from engineering records, as follows