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Smelly Perfume Company manufactures and distributes several different products. The company currently uses a plant wide allocation method for allocating overhead at a rate of
Smelly Perfume Company manufactures and distributes several different products. The company currently uses a plant wide allocation method for allocating overhead at a rate of $9 per direct labor hour. Cindy is the department manager of Department C which produces Products J and P. Department C has $18,000 in traceable overhead. Diane is the department manager of Department D which manufactures Product X. Department D has $13, 050 in traceable overhead. The product costs (per case of 24 bottles) and other information are as follows: If Smelly changes its overhead allocation to departmental rates, what is the product cost per case for Product X assuming Departments C and D use direct labor hours and machine hours as their respective allocation bases? $142.75 $150.00 $121.00 $141.75
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