Plantwide Factory Overhead Rate Scrumptious Snacks Inc. manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period: Factory depreciation $14,388   Indirect labor 35,657   Factory electricity 4,066   Indirect materials 8,445   Selling expenses 20,018

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Single Plantwide Factory Overhead Rate

Scrumptious Snacks Inc. manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period:

Factory depreciation $14,388  
Indirect labor 35,657  
Factory electricity 4,066  
Indirect materials 8,445  
Selling expenses 20,018  
Administrative expenses 11,260  
  Total costs $93,834  

Factory overhead is allocated to the three products on the basis of processing hours. The products had the following production budget and processing hours per case:

  Budgeted Volume
(Cases)
Processing Hours
Per Case
Tortilla chips   4,200     0.10    
Potato chips   3,300     0.15    
Pretzels   2,400     0.12    
  Total   9,900          

If required, round all per-case answers to the nearest cent.

a.  Determine the single plantwide factory overhead rate.
$fill in the blank 1 per processing hour

b.  Use the overhead rate in (a) to determine the amount of total and per-case overhead allocated to each of the three products under generally accepted accounting principles.

  Total
Factory Overhead
Per-Case
Factory Overhead
Tortilla chips $fill in the blank 2 $fill in the blank 3
Potato chips    fill in the blank 4    fill in the blank 5
Pretzels    fill in the blank 6    fill in the blank 7
Total  $fill in the blank 8  
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