Walton Hats Corporation manufactures three different models of hats: Vogue, Beauty, and Glamour. Walton expects to incur $625,000 of overhead cost during the next fiscal year. Other budget information follows:

		Vogue		Beauty		Glamour		Total
Direct labor hours		5,400		7,400		12,200		25,000
Machine hours		1,500		1,400		2,100		5,000

Required

1. Use direct labor hours as the cost driver to compute the allocation rate and the budgeted overhead cost for each product.

2. Use machine hours as the cost driver to compute the allocation rate and the budgeted overhead cost for each product.

Use direct labor hours as the cost driver to compute the allocation rate and the budgeted overhead cost for each product.

Product	Allocation Rate	x	Weight of Base	=	Allocated Cost
Vogue		x		=
Beauty		x		=
Glamour		x		=
Total

• Use machine hours as the cost driver to compute the allocation rate and the budgeted overhead cost for each product.

  Product	Allocation Rate	x	Weight of Base	=	Allocated Cost
  Vogue		x		=
  Beauty		x		=
  Glamour		x		=
  Total