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Stuart Company makes three products in its factory: plastic cups, plastic tablecloths, and plastic bottles. The expected overhead costs for the next fiscal year include
Stuart Company makes three products in its factory: plastic cups, plastic tablecloths, and plastic bottles. The expected overhead costs for the next fiscal year include the following. Factory manager's salary Factory utility cost Factory supplies Total overhead costs $222,250 76,000 29,000 $327,250 Stuart uses machine hours as the cost driver to allocate overhead costs. Budgeted machine hours for the products are as follows. Cups Tablecloths Bottles Total machine hours 270 Hours 675 925 1,870 Required a. Allocate the budgeted overhead costs to the products. Product Allocation Rate x Weight of Base Allocated Cost = Cups Tablecloths x x x Bottles = Total
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