Mets Products produces baseball caps and T-shirts. Most of the production is done by machine. Data on
Management asks the firms cost accountant to compute product costs. The accountant first assigns overhead costs to two pools: overhead related to direct materials and overhead related to machine-hours.
The analysis of overhead accounts by the cost accountant follows:
a. Compute the predetermined overhead rates assuming that Mets Products uses machine-hours to allocate machine-related overhead costs and materials costs to allocate materials-related overhead costs.
b. Compute the total costs of production and the cost per unit for each of the two products forOctober.
Step by Step Answer: