Plantwide rate Overhead Scientific Business 2. Compute the overhead cost per unit for each product using departmental rates. In calculating departmental rates, use machine hours for Department 1 and direct labor hours for Department 2. Repeat using direct labor hours for Department 1 and machine hours for Department 2. Round your intermediate calculations and answers to the nearest cent. Departmental rates: Department 1 Department 2 Overhead cost per unit: Scientific Business cost per unit: Departmental rates: Department 1 Department 2 Overhead cost per unit: Scientific Business Scientific Business product S per direct labor hour $ per unit S per unit $ per unit $ per unit $ per machine hour S per direct labor hour $ per unit $ per unit (wide, unic $ per direct labor hour S per machine hour $ per unit $ per unit 3. Compute the overhead cost per unit for each product using activity-based costing. Round your calculations and answers to the nearest cent. Overhead Cost
Plantwide rate Overhead Scientific Business 2. Compute the overhead cost per unit for each product using departmental rates. In calculating departmental rates, use machine hours for Department 1 and direct labor hours for Department 2. Repeat using direct labor hours for Department 1 and machine hours for Department 2. Round your intermediate calculations and answers to the nearest cent. Departmental rates: Department 1 Department 2 Overhead cost per unit: Scientific Business cost per unit: Departmental rates: Department 1 Department 2 Overhead cost per unit: Scientific Business Scientific Business product S per direct labor hour $ per unit S per unit $ per unit $ per unit $ per machine hour S per direct labor hour $ per unit $ per unit (wide, unic $ per direct labor hour S per machine hour $ per unit $ per unit 3. Compute the overhead cost per unit for each product using activity-based costing. Round your calculations and answers to the nearest cent. Overhead Cost
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Problem 4.36
Product-Costing Accuracy, Plantwide and Departmental Rates, ABC
Escuha Company produces two type of calculators: scientific and business. Both products pass through two producing departments. The business calculator is by far the most popular. The following data have been
gathered for these two products:
Units produced per year
Prime costs
Direct labor hours
Machine hours
Production runs
Inspection hours
Maintenance hours
Direct labor hours:
Scientific calculator
Business calculator
Total
Machine hours:
Scientific calculator
Business calculator
Total
Overhead costs:
Setup costs
Inspection costs
Power
Maintenance
Total
g
Product-Related Data
Scientific
75,000
$250,000
100,000
50,000
100
2,000
2,250
Department 1
Department Data
75,000
112,500
187,500
25,000
400,000
425,000
Business
$225,000
175,000
250,000
200,000
$850,000
750,000
$2,500,000
1,000,000
500,000
150
3,000
9,000
Department 2
25,000
887,500
912,500
25,000
100,000
125,000
$225,000
175,000
150,000
250,000
$800,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4a7576c6-c7d6-4b7e-a2ef-96b9f857b8a8%2F893c6cb0-4b95-43b5-b927-83d507134688%2Fthr330g_processed.png&w=3840&q=75)
Transcribed Image Text:Problem 4.36
Product-Costing Accuracy, Plantwide and Departmental Rates, ABC
Escuha Company produces two type of calculators: scientific and business. Both products pass through two producing departments. The business calculator is by far the most popular. The following data have been
gathered for these two products:
Units produced per year
Prime costs
Direct labor hours
Machine hours
Production runs
Inspection hours
Maintenance hours
Direct labor hours:
Scientific calculator
Business calculator
Total
Machine hours:
Scientific calculator
Business calculator
Total
Overhead costs:
Setup costs
Inspection costs
Power
Maintenance
Total
g
Product-Related Data
Scientific
75,000
$250,000
100,000
50,000
100
2,000
2,250
Department 1
Department Data
75,000
112,500
187,500
25,000
400,000
425,000
Business
$225,000
175,000
250,000
200,000
$850,000
750,000
$2,500,000
1,000,000
500,000
150
3,000
9,000
Department 2
25,000
887,500
912,500
25,000
100,000
125,000
$225,000
175,000
150,000
250,000
$800,000
![1. Compute the overhead cost per unit for each product using a plantwide, unit-based rate using direct labor hours. If required, round your answers to the nearest cent.
Plantwide rate
$ per direct labor hour
Overhead cost per unit:
Scientific
Business
2. Compute the overhead cost per unit for each product using departmental rates. In calculating departmental rates, use machine hours for Department 1 and direct labor hours for Department 2. Repeat using direct labor hours for Department 1 and machine
hours for Department 2. Round your intermediate calculations and answers to the nearest cent.
Departmental rates:
Department 1
Department 2
Overhead cost per unit:
Scientific
Business
Departmental rates:
Department 1
Department 2
Overhead cost per unit:
Scientific
Business
$ per unit
$ per unit
Scientific
Business
$ per unit
$ per unit
$ per machine hour
$ per direct labor hour
$ per unit
$ per unit
$ per unit
$ per unit
3. Compute the overhead cost per unit for each product using activity-based costing. Round your calculations and answers to the nearest cent.
Overhead Cost
$ per direct labor hour
S per machine hour](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4a7576c6-c7d6-4b7e-a2ef-96b9f857b8a8%2F893c6cb0-4b95-43b5-b927-83d507134688%2Fln0iry_processed.png&w=3840&q=75)
Transcribed Image Text:1. Compute the overhead cost per unit for each product using a plantwide, unit-based rate using direct labor hours. If required, round your answers to the nearest cent.
Plantwide rate
$ per direct labor hour
Overhead cost per unit:
Scientific
Business
2. Compute the overhead cost per unit for each product using departmental rates. In calculating departmental rates, use machine hours for Department 1 and direct labor hours for Department 2. Repeat using direct labor hours for Department 1 and machine
hours for Department 2. Round your intermediate calculations and answers to the nearest cent.
Departmental rates:
Department 1
Department 2
Overhead cost per unit:
Scientific
Business
Departmental rates:
Department 1
Department 2
Overhead cost per unit:
Scientific
Business
$ per unit
$ per unit
Scientific
Business
$ per unit
$ per unit
$ per machine hour
$ per direct labor hour
$ per unit
$ per unit
$ per unit
$ per unit
3. Compute the overhead cost per unit for each product using activity-based costing. Round your calculations and answers to the nearest cent.
Overhead Cost
$ per direct labor hour
S per machine hour
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Step 1: Plant wide overhead
VIEWStep 2: calculate plantwide overhead rate based on direct labor
VIEWStep 3: compute departmental rates for both the departments machine hours for D1 & Lab for D2
VIEWStep 4: overhead cost per unit
VIEWStep 5: compute departmental rates for both the departments lab hours for D1 & machine for D2
VIEWStep 6: overhead cost per unit
VIEWStep 7: activity rates calculations
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