Camper's Edge Factory produces two products: canopies and tents. The total factory overhead is budgeted at $750,000 for the year, divided between two departments: Cutting, $350,000, and Sewing, $400,000. Each canopy requires 2 direct labor hours in Cutting and 1 direct labor hour in Sewing. Each tent requires 1 direct labor hour in Cutting and 6 direct labor hours in Sewing. Production for the year is budgeted for 20,000 canopies and 10,000 tents.a. Determine the total number of budgeted direct labor hours for the year in each department.Cuttingfill in the blank 1 direct labor hoursSewingfill in the blank 2 direct labor hoursb. Determine the departmental factory overhead rate for each department. Round your answers to two decimal places, if necessary.Cutting$fill in the blank 3 per direct labor hourSewing$fill in the blank 4 per direct labor hourc. Determine the factory overhead allocated per unit of each product, using the departmental factory overhead rates determined in (b). Round your answers to two decimal places, if necessary.Total FOH allocated per canopy$fill in the blank 5Total FOH allocated per tent$fill in the blank 6

Departmental factory overhead rate = Factory overhead costs / No. of direct labor hoursa. Cutting: Canopy = 20000 canopy× 2 hours = 40000 hours Tents = 10000 tents × 1 hours = 10000 hours Total Budgeted direct labor hours in Cutting department= 50,000 hours Sewing: Canopy = 20000 canopy × 1 hours= 20000 hours Tents = 10000 tents × 6 hours= 60000 hours Total Budgeted direct labor hours in Sewing department= 80,000 hoursb. Departmental factory overhead rate = Factory overhead costs / No. of direct labor hours Cutting = $350,000 / 50,000 hours = $7 per hour Sewings = $400,000 / 80,000 hours = $5 per hour c. Factory overhead allocated per unit of each product: Canopy = (Cutting hours used per canopy x Factory overhead rate per hour for cutting) + (Sewing hours per canopy x hours rate per sewing ) = ( 2hours x $7) + (1 hours x $5 ) = $9 per canopy Tent = (Per unit hours of cutting x rate per cutting hours) + (Hours used for sewing x rate per hour of sewing) = (1 hours x $7) + (6 hours x $5 )= $37 per tent

Answered: Camper's Edge Factory produces two…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Camper's Edge Factory produces two products: canopies and tents. The total factory overhead is budgeted at $750,000 for the year, divided between two departments: Cutting, $350,000, and Sewing, $400,000. Each canopy requires 2 direct labor hours in Cutting and 1 direct labor hour in Sewing. Each tent requires 1 direct labor hour in Cutting and 6 direct labor hours in Sewing. Production for the year is budgeted for 20,000 canopies and 10,000 tents.

a. Determine the total number of budgeted direct labor hours for the year in each department.

Cutting	fill in the blank 1 direct labor hours
Sewing	fill in the blank 2 direct labor hours

b. Determine the departmental factory overhead rate for each department. Round your answers to two decimal places, if necessary.

Cutting	$fill in the blank 3 per direct labor hour
Sewing	$fill in the blank 4 per direct labor hour

c. Determine the factory overhead allocated per unit of each product, using the departmental factory overhead rates determined in (b). Round your answers to two decimal places, if necessary.

Total FOH allocated per canopy	$fill in the blank 5
Total FOH allocated per tent	$fill in the blank 6

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