a. Determine the two production department factory overhead rates. Assembly Department per direct labor hour Test and Pack Department per direct labor hour b. Determine the total factory overhead and the factory overhead per unit allocated to each product. Product Total Factory Overhead Factory Overhead Per Unit Blender Toaster oven %24 %24
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
![Multiple Production Department Factory Overhead Rate Method
Four Finger Appliance Company manufactures small kitchen appliances. The product line consists of blenders and toaster ovens. Four Finger Appliance
presently uses the multiple production department factory overhead rate method. The factory overhead is as follows:
Assembly Department
$186,000
Test and Pack Department
120,000
Total
$306,000
The direct labor information for the production of 7,500 units of each product is as follows:
Assembly Department
Test and Pack Department
Blender
750 dlh
2,250 dlh
Toaster oven
2,250
750
Total
3,000 dlh
3,000 dlh
Four Finger Appliance used direct labor hours to allocate production department factory overhead to products.
If required, round all per unit answers to the nearest cent.
a. Determine the two production department factory overhead rates.
Assembly Department
per direct labor hour
Test and Pack Department
per direct labor hour](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1669f052-7c64-4670-b150-2cccd7d3d071%2Fe71a2197-5dbb-486b-bc3a-81183a968bca%2Fd41o2i_processed.jpeg&w=3840&q=75)
![Test and Pack Department
120,000
Total
$306,000
The direct labor information for the production of 7,500 units of each product is as follows:
Assembly Department
Test and Pack Department
Blender
750 dlh
2,250 dlh
Toaster oven
2,250
750
Total
3,000 dlh
3,000 dlh
Four Finger Appliance used direct labor hours to allocate production department factory overhead to products.
If required, round all per unit answers to the nearest cent.
a. Determine the two production department factory overhead rates.
Assembly Department
per direct labor hour
Test and Pack Department
per direct labor hour
b. Determine the total factory overhead and the factory overhead per unit allocated to each product.
Product
Total Factory Overhead
Factory Overhead Per Unit
Blender
Toaster oven](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1669f052-7c64-4670-b150-2cccd7d3d071%2Fe71a2197-5dbb-486b-bc3a-81183a968bca%2Fqcmnlnk_processed.jpeg&w=3840&q=75)
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