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Stewart Marketing Inc. manufactures two products, A andB. Presently, the company uses a single plant-wide factory overheadrate for allocating overhead to products. However, management isconsidering moving to a multiple department rate system forallocating overhead. From the following information, using a singleplant-wide rate, determine the overhead rate per unit for ProductA:



Overhead


Direct Labor
Hours (dlh)


Product

A

B
Painting Dept.

$248,000

10,000 dlh

 16 dlh 4 dlh
Finishing Dept.

72,000

10,000

4 16
Totals

$320,000

20,000 dlh

 20 dlh 20 dlh

========

==========

 ====== ======
$496.00 per unit
$320.00 per unit
$144.00 per unit
$640.00 per unit

Stewart Marketing Inc. manufactures two products, A andB. Presently, the company uses a single plant-wide factory overheadrate for allocating overhead to products. However, management isconsidering moving to a multiple department rate system forallocating overhead. From the following information, using a singleplant-wide rate, determine the overhead rate per unit for ProductB:



Overhead
Direct Labor
Hours (dlh)
Product
A B
Painting Dept. $248,000 10,000 dlh 16 dlh 4 dlh
Finishing Dept. 72,000 10,000 4 16
Totals $320,000 20,000 dlh 20 dlh 20 dlh
======== ========== ====== ======
$320.00
$496.00
$144.00
$640.00

The single plantwide factory overhead rate is $52 perdirect labor hour. The company implements activity-based costingusing four different activity bases, including direct labor hours(and three others). What can be said about the direct labor rateunder activity-based costing relative to the single plantwiderate?

The direct labor rate under activity-based costing will beequal to $52 per direct labor hour.
The direct labor rate under activity-based costing cannot becompared meaningfully to the $52 per direct labor hour rate.
The direct labor rate under activity-based costing must be lessthan $52 per direct labor hour.
The direct labor rate under activity-based costing must begreater than $52 per direct labor hour.

The Nite Lite Factory produces two products - smalllamps and desk lamps. It has two separate departments - finishingand production. The overhead budget for the finishing department is$550,000, using 500,000 direct labor hours. The overhead budget forthe production department is $400,000 using 80,000 direct laborhours. If the budget estimates that a desk lamp will require 1hours of finishing and 2 hours of production, how much factoryoverhead will be allocated to each unit of desk lamps using themultiple production department factory overhead rate method with anallocation base of direct labor hours?

$11.10
$10.00
$4.91
$5.00

The Delph Company produces two products, Blinks andDinks. They are manufactured in two departments, Fabrication andassembly. Data for the products and departments are listedbelow.


Product 		Number
of units		 Labor hrs per unit Machine hours
per unit
Blinks 1,000 4 5
Dinks 2,000 2 8

All of the Machine hours take place in the Fabricationdepartment, which has an estimated overhead of $84,000. All of thelabor hours take place in the Assembly department, which has anestimated total overhead of $72,000.

The Delph Company usesa departmental overheadrates. The fabrication department uses machinehours for an allocation base, and the assembly department useslabor hours. What is the overhead cost per unit forDinks?

$64
$44
$56
$50

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Bunny Greenfelder
Bunny GreenfelderLv2
28 Sep 2019

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Related questions

Stewart Marketing Inc. manufactures two products, A andB. Presently, the company uses a single plant-wide factory overheadrate for allocating overhead to products. However, management isconsidering moving to a multiple department rate system forallocating overhead. From the following information, determine theoverhead from both production departments allocated to each unit ofProduct B if the company uses a multiple department ratesystem.



Overhead
Direct Labor
Hours (dlh)
Product
A B
Painting Dept. $248,000 10,000 dlh 16 dlh 4 dlh
Finishing Dept. 72,000 10,000 4 16
Totals $320,000 20,000 dlh 20 dlh 20 dlh
======== ========== ====== ======
$214.40 per unit
$99.20 per unit
$320.00 per unit
$425.60 per unit

Phelan Systems Corporation is estimating activity costsassociated with producing disk drives, tapes drives, and wiredrives. The indirect labor can be traced to four separate activitypools. The budgeted activity cost and activity base information,along with the estimated activity-base information, is providedbelow.

Activity
Cost
Activity Base
Procurement $ 360,000 Number of purchase orders
Scheduling 240,000 Number of production orders
Materials handling 480,000 Number of moves
Product development 720,000 Number of engineering changes
Production 1,420,000 Machine hours

Number of
Purchase
Orders		 Number
of
Production
Orders
Number
of
Moves
Number of Engineering
Changes

Machine
Hours
Number
of
Units
Disk drives 4,000 300 1,400 10 2,000 2,000
Tape drives 2,000 150 600 5 8,000 4,000
Wire drives 12,000 800 4,000 25 10,000 2,500


Determine the activity rate for product development perchange.

$28,000
$72,000
$18,000
$36,000

The management of Firebolt Industries Inc. manufactures gasolineand diesel engines through two production departments, Fabricationand Assembly. Management needs accurate product cost information inorder to guide product strategy. Presently, the company uses asingle plantwide factory overhead rate for allocating factoryoverhead to the two products. However, management is consideringthe multiple production department factory overhead rate method.The following factory overhead was budgeted for Firebolt:

1

Fabrication Department factory overhead

$614,800.00

2

Assembly Department factory overhead

246,750.00

3

Total

$861,550.00

Direct labor hours were estimated as follows:

Fabrication Department 5,300 hours
Assembly Department 5,250
Total 10,550 hours

In addition, the direct labor hours (dlh) used to produce a unitof each product in each department were determined from engineeringrecords, as follows:

ProductionDepartments GasolineEngine DieselEngine
Fabrication Department 2.9 dlh 1.8 dlh
Assembly Department 1.8 2.9
Direct labor hours perunit 4.7 dlh 4.7 dlh
Required:

a. Determine the per-unit factory overhead allocated to thegasoline and diesel engines under the single plantwide factoryoverhead rate method, using direct labor hours as the activity base. If required, round all per-direct labor hours and per-unitanswers to the nearest cent.

Gasoline engine per unit
Diesel engine per unit

b. Determine the per-unit factory overhead allocated to thegasoline and diesel engines under the multiple productiondepartment factory overhead rate method, using direct labor hoursas the activity base for each department. If required, round allper-unit answers to the nearest cent.

Gasoline engine per unit
Diesel engine per unit
c. (1) Recommend to management aproduct costing approach, based on your analyses in (a) and (b).(2) Give a reason for your answer.
*If required, round allper-unit answers to the nearest cent.

PLEASE MAKE THE ANSWERS UNDERSTANDABLE. THANKS


The 2nd time...****I just need the answers. Please round to the nearest cent****** Look at the numbers provided.

The management of Firebolt Industries Inc. manufactures gasoline and diesel engines through two production departments, Fabrication and Assembly. Management needs accurate product cost information in order to guide product strategy. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering the multiple production department factory overhead rate method. The following factory overhead was budgeted for Firebolt:

1

Fabrication Department factory overhead

$636,650.00

2

Assembly Department factory overhead

243,000.00

3

Total

$879,650.00

Direct labor hours were estimated as follows:

Fabrication Department 5,350 hours
Assembly Department 5,400
Total 10,750 hours

In addition, the direct labor hours (dlh) used to produce a unit of each product in each department were determined from engineering records, as follows:

Production Departments Gasoline Engine Diesel Engine
Fabrication Department 2.9 dlh 1.9 dlh
Assembly Department 1.9 2.9
Direct labor hours per unit 4.8 dlh 4.8 dlh
Required:
a. Determine the per-unit factory overhead allocated to the gasoline and diesel engines under the single plantwide factory overhead rate method, using direct labor hours as the activity base.*
b. Determine the per-unit factory overhead allocated to the gasoline and diesel engines under the multiple production department factory overhead rate method, using direct labor hours as the activity base for each department.*
c. (1) Recommend to management a product costing approach, based on your analyses in (a) and (b). (2) Give a reason for your answer.

*If required, round all per-unit answers to the nearest cent

Single plantwide Method:

a. Determine the per-unit factory overhead allocated to the gasoline and diesel engines under the single plantwide factory overhead rate method, using direct labor hours as the activity base . If required, round all per-direct labor hours and per-unit answers to the nearest cent.

Gasoline engine $_________per unit
Diesel engine $_________per unit

Multiple production department method:

b. Determine the per-unit factory overhead allocated to the gasoline and diesel engines under the multiple production department factory overhead rate method, using direct labor hours as the activity base for each department. If required, round all per-unit answers to the nearest cent.

Gasoline engine $_______per unit
Diesel engine $_______per unit

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