Single Plantwide Factory Overhead Rate
The total factory overhead for Bardot Marine Company is budgeted for the year at $1,305,000. Bardot Marine manufactures two types of boats: speedboats and bass boats. The speedboat and bass boat each require six direct labor hours for manufacture. Each product is budgeted for 7,500 units of production for the year.
When required, round all per unit answers to the nearest cent.
a. Determine the total number of budgeted
direct labor hours for the year.
direct labor hours
b. Determine the single plantwide factory
c. Determine the factory overhead allocated per unit for each product using the single plantwide factory overhead rate.
Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows:
|Fabrication||$21||per machine hour|
|Assembly||$16||per direct labor hour|
|Production scheduling||$17||per production order|
|Purchasing||$14||per purchase order|
The activity-base usage quantities and units produced for each product were as follows:
|Activity Base||Elliptical Machines||Treadmill|
|Direct labor hours||440||172|
Use the activity rate and usage information to determine the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent.
Question 1 )
a)Total Budgeted direct labor hours :
|Hours per unit||*||Number of units||=||Total hours required|
|Total budgeted direct labor hours||90000|
Plantwide overhead rate =Estimated overhead /estimated DLH
= 1305000 /90000
= $ 14.5 PER dlh
|Hours per unit||*||Overhead rate per hour||=||Overhead allocated per unit|
|Elliptical Machines (Activity rate*Activity usage) [i]||Treadmill (Activity rate*Activity usage) [ii]||Total activity cost [i+ii]|
|Assembly||16*440= 7040||16*172= 2752||9792|
|set up||45*59=2655||45*18= 810||3465|
|Number of units||293||196|
|activity cost per unit||68286/293= 233.06||193.33|
Total activity cost = 106179