Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours. Painting Dept. Finishing Dept. Totals Overhead a. $46.20 per unit Ob. $33.61 per unit Oc. $16.79 per unit d. $23.10 per unit $265,600 72,200 $337,800 Direct Labor Hours (dih) 11,500 dlh 8,600 20,100 dlh Product A 13 dlh 2 15 dih B 2 dlh 15 17 dlh Determine the overhead in the Painting Department for each unit of Product B if Blue Ridge Marketing Inc. uses a multiple department rate system.
Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours. Painting Dept. Finishing Dept. Totals Overhead a. $46.20 per unit Ob. $33.61 per unit Oc. $16.79 per unit d. $23.10 per unit $265,600 72,200 $337,800 Direct Labor Hours (dih) 11,500 dlh 8,600 20,100 dlh Product A 13 dlh 2 15 dih B 2 dlh 15 17 dlh Determine the overhead in the Painting Department for each unit of Product B if Blue Ridge Marketing Inc. uses a multiple department rate system.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a
single plantwide factory overhead rate for allocating overhead to products. However, management
is considering moving to a multiple department rate system for allocating overhead. The following
table presents information about estimated overhead and direct labor hours.
Painting Dept.
Finishing Dept.
Totals
Overhead
a. $46.20 per unit
b. $33.61 per unit
Oc. $16.79 per unit
Od. $23.10 per unit
$265,600
72,200
$337,800
Direct
Labor Hours (dih)
11,500 dlh
8,600
20,100 dlh
Product
A
13 dlh
2
15 dih
B
2 dlh
15
17 dlh
Determine the overhead in the Painting Department for each unit of Product B if Blue Ridge
Marketing Inc. uses a multiple department rate system.
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