Drive Safe, Inc. a leading manufacturer of car spare parts, divided its manufacturing process into two Departments - Production and Packing. The estimated overhead costs for the Production and Packing departments amounted to $14,000,000 and $20,000,000, respectively. The company produces two types of parts - Part 1 and Part 2. The total estimated labor hours for the year were 40,000, and estimated machine hours were 35,000. The Production department is mechanized, whereas the Packing department is labor oriented. Calculate the amount of manufacturing overhead costs allocated to Part 1.   Production Packing Machine hours Labor hours Part 1 10,000 30,000 Part 2 25,000 10,000           35,000 40,000

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Drive Safe, Inc. a leading manufacturer of car spare parts, divided its manufacturing process into two

Departments - Production and Packing. The estimated overhead costs for the Production and Packing

departments amounted to $14,000,000 and $20,000,000, respectively. The company produces two types of parts - Part 1 and Part 2. The total estimated labor hours for the year were 40,000, and estimated machine hours were 35,000. The Production department is mechanized, whereas the Packing department is labor oriented. Calculate the amount of manufacturing overhead costs allocated to Part 1.

 

Production Packing

Machine hours Labor hours

Part 1 10,000 30,000

Part 2 25,000 10,000

          35,000 40,000

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