The Aleutian Company produces two products, Rings and Dings. They are manufactured in two departmentsFabrication and Assembly. Data for the products and departments are listed below.

Product

Number ofUnits Labor Hours Per Unit Machine Hours Per Unit

Rings 930 5 8

Dings 2,310 8 9

All of the machine hours take place in the Fabrication Department, which has an estimated overhead of $86,500. All of the labor hours take place in the Assembly Department, which has an estimated total overhead of $70,700.

The Aleutian Company uses a departmental overhead rates. The Fabrication Department uses machine hours for an allocation base, and the Assembly Department uses labor hours.

What is the overhead cost per unit for Dings?

a.$52.02

b.$48.52

c.$39.78

d.$3.73

Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours.

Overhead DirectLabor Hours (dlh) Product A B

Painting Dept .$227,900 11,500dlh 13dlh 7dlh

Finishing Dept .75,400 8,600 7 16

Totals $303,300 20,100dlh 20dlh 23dlh

Determine the overhead in the Painting Department for each unit of Product B if Blue Ridge Marketing Inc. uses a multiple department rate system.

a.$138.74 per unit

b.$105.63 per unit

c.$61.37 per unit

d.$19.82 per unit