Question: Procter & Gamble allocates overhead for Dept A (30,000 machine hours, $1,200,000) and Dept B (20,000 labor hours, $800,000). Requirements: Calculate the overhead allocation rate

  1. Procter & Gamble allocates overhead for Dept A (30,000 machine hours, $1,200,000) and Dept B (20,000 labor hours, $800,000).
    • Requirements:
      • Calculate the overhead allocation rate for each department.
      • Allocate overhead costs to products C (8,000 machine hours, 4,000 labor hours) and D (5,000 machine hours, 3,000 labor hours).
      • Prepare a cost analysis for both products.
      • Assess the impact of overhead allocation on product profitability and pricing strategies.

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