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The Madsen Shirt Company manufactures shirts in two departments: Cutting and Sewing. The company allocates manufacturing overhead using a single plantwide rate with direct labor
The Madsen Shirt Company manufactures shirts in two departments: Cutting and Sewing. The company allocates manufacturing overhead using a single plantwide rate with direct labor hours as the allocation base. Estimated overhead costs for the year are $750,000, and estimated direct labor hours are 250,000. In June, the company incurred 18,400 direct labor hours. 1. Compute the predetermined overhead allocation rate. 2. Determine the amount of overhead allocated in June. The Madsen Shirt Company has refined its allocation system by separating manufacturing overhead costs into two cost poolsone for each department. (Click the icon to view the estimated costs and allocation data for each department.) 3. Compute the predetermined overhead allocation rates for each department. 4. Determine the total amount of overhead allocated in June. 1. Compute the predetermined overhead allocation rate. Begin by selecting the formula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate using a single plantwide rate with direct labor hours as the allocation base.. Predetermined OH x allocation rate More Info - 2. Determine the amount of overhead allocated in June. Begin by selecting the formula to allocate overhead costs. Use a single plantwide rate with direct labor hours as the allocation base. Allocated mfg. The estimated costs for the Cutting Department are $266,700. They will be allocated based on direct labor hours, which are estimated to be 127,000 hours for the year. The estimated costs for the Sewing Department are $425,000. Those costs will be allocated based on machine hours, which are estimated to be 170,000 hours for the year. In June, the company incurred 9,000 direct labor hours in Cutting and 11,000 machine hours in Sewing. overhead costs The overhead allocated in June is Print Done 3. Compute the predetermined overhead allocation rates for each department. Begin by selecting the formula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate for each department. Predetermined OH allocation rate Cutting Sewing 4. Determine the total amount of overhead allocated in June. Compute the overhead allocated in June for each department and the total for both departments. Cutting Sewing Total Choose from any list or enter any number in the input fields and then continue to the next
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