Untitled - Paint File View Departmental Overhead Rates Lansing, Inc., provided the following data for its two producing departments: Molding Estimated overhead $375,000 Polishing $60,000 Total $435,000 Direct labor hours (expected and actual): Form A Form B Total Machine hours: Form A Form B Total 1,000 5,000 6,000 4,000 15,000 19,000 5,000 20,000 25,000 3,600 3,000 6,600 1,400 2,000 5,000 5,000 3,400 10,000 Machine hours are used to assign the overhead of the Molding Department, and direct labor hours are used to assign the overhead of the Polishing Department. There are 25,000 units of Form A produced and sold and 50,000 of Form B. Required: 1. Calculate the overhead rates for each department. Molding $ Polishing 75 per machine hour 3 per direct labor hour 2. Using departmental rates, assign overhead to the two products and calculate the overhead cost per unit. Round your answers to the nearest cent. Assigned unit overhead cost for Form A Assigned unit overhead cost for Form B Unit Overhead Cost 16.05 X per unit 3.28 X per unit 1. Calculate the oveimeau Tates for each department. Molding Polishing 75 per machine hour 3 per direct labor hour 2. Using departmental rates, assign overhead to the two products and calculate the overhead cost per unit. Round your answers to the nearest cent. Assigned unit overhead cost for Form A Assigned unit overhead cost for Form B Unit Overhead Cost 16.05 X per unit $ 3.28 X per unit How does this compare with the plantwide rate unit cost, using direct labor hours? Relative to the plantwide rate, the cost increased for Form A and decreased for Form B. 3. What if the machine hours in Molding were 1,200 for Form A and 3,800 for Form B and the direct labor hours used in Polishing were 5,000 and 15,000, respectively? Calculate the overhead cost per unit for each product using departmental rates. Round your answers to the nearest cent. Unit Overhead Cost Form A 5.85 X per unit Form B $ 6.60 per unit Compare with the plantwide rate unit costs calculated in Requirement 2. What can you conclude from this outcome? Relative to the plantwide rate, the cost increased for Form A and decreased for Form B. Feedback Check My Work 1. For departmental rates, OH rates are assigned to each production department either per machine hrs. or direct labor hrs. Dept. estimated OH + machine hour = rate per machine hour. Dept. estimated OH + direct labor hour = rate per direct labor hour 2. Machine hours are used to assign OH of the Molding Dept. and direct labor hours are used to assign OH of the Polishing Dept. Total applied OH + Units of production = Unit OH cost (each form). Plantwide rate = total estimated OH + total direct hours 3. Use new numbers given and calculate OH the same as in Requirement 1 & 2, compare departmental to plantwide, and give conclusion of the results. Check My Work All work saved. Previous Next > Save and Exit Submit Assignment for Grading