Ramapo Company uses a single plantwide overhead rate (rounded to the nearest cent) to apply all factory overhead costs based on direct labor hours. The factory overhead allocated per unit of Blinks is a.$219.22 b.$50.50 c.$21.71 d.$75.74
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Question Content Area
Ramapo Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and Assembly. Data for the products and departments are as follows:
ProductNumber of
UnitsDirect Labor Hours
Per UnitMachine Hours
Per UnitBlinks 944 2 6 Dinks 1,973 3 6
All of the machine hours take place in the Fabrication department, which has an estimated
overhead of $87,500. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $109,600.Ramapo Company uses a single plantwide overhead rate (rounded to the nearest cent) to apply all
factory overhead costs based on direct labor hours. The factory overhead allocated per unit of Blinks isa.$219.22b.$50.50c.$21.71d.$75.74
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