Elevator Co. makes two product models, A and B, and provides both installation and inspection services for its customers. Budgeted information is as follows:   Installation Inspection Total Budgeted overhead 300,000 210,000 510,000 Budgeted labor hours 2,000 3,000 5,000   Product A Product B Total Direct labor hours per unit: 2.0 1.5 5,000 Installation 1.0 0.5 2,000 Inspection 1.0 1.0 3,000 Units 1,000 2,000 3,000 The company uses a departmental method to allocate overhead in each of the two cost pools - installation and inspection. How much overhead per unit is allocated to product B if the company uses direct labor hours as the allocation base? Choose any of the answer below.   A. 145 B. 105 C. 110 D. 225

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Elevator Co. makes two product models, A and B, and provides both installation and inspection services for its customers. Budgeted information is as follows:

 

Installation

Inspection

Total

Budgeted overhead

300,000

210,000

510,000

Budgeted labor hours

2,000

3,000

5,000

 

Product A

Product B

Total

Direct labor hours per unit:

2.0

1.5

5,000

Installation

1.0

0.5

2,000

Inspection

1.0

1.0

3,000

Units

1,000

2,000

3,000

The company uses a departmental method to allocate overhead in each of the two cost pools - installation and inspection. How much overhead per unit is allocated to product B if the company uses direct labor hours as the allocation base?

Choose any of the answer below.
 

A. 145

B. 105

C. 110

D. 225

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