The Anchorage plant of the Tundra Company produces two calculators and has two production departments: assembly and

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The Anchorage plant of the Tundra Company produces two calculators and has two production departments: assembly and packaging. Information for the products is given below:
Deluxe Regular Total Units Produced 20000 200000 Prime Costs $1660000 $160000 S1500000 Direct Labor Hours 20000 160000 1

The following table presents activity information about the departments and products:

Assembly Packaging Total Direct Labor Hours: Deluxe 10000 10000 20000 Regular 150000 10000 160000 Total 160000 20000 180

Required:
(a) Compute the predetermined overhead rate for each department if Assembly uses labor hours and Packaging uses machine hours.
(b) Calculate the per unit cost for each product if departmental overhead rates are used. (round to 2 decimal places)
(c) Computer the predetermined plant-wide overhead rate based on direct labor hours.
(d) Calculate the per unit cost of each product if a plant-wide overhead rate is used. (Round to 2 decimal places)
(e) Calculate the overhead rates for each overhead activity.
(f) Calculate the per unit cost of each product if activity rates are used to assign overhead. (Round to 2 decimal places)

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Related Book For  book-img-for-question

Managerial Accounting Tools for Business Decision Making

ISBN: 978-1118033890

3rd Canadian edition

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly

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