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 Indirect labor Factory electricity Indirect materials Selling expenses Administrative expenses Total costs Tortilla chips Potato chips 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: Pretzels Total Budgeted Volume (Cases) Tortilla chips Potato chips Pretzels 3,300 2,100 1,800 7,200 Total If required, round all per-case answers to the nearest cent. $11,066 27,425 3,127 6,496 a. Determine the single plantwide factory overhead rate. $ 15,396 8,661 $72,171 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 $ Processing Hours Per Case 0.12 0.15 0.10 Per-Case Factory Overhead
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 Indirect labor Factory electricity Indirect materials Selling expenses Administrative expenses Total costs Tortilla chips Potato chips 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: Pretzels Total Budgeted Volume (Cases) Tortilla chips Potato chips Pretzels 3,300 2,100 1,800 7,200 Total If required, round all per-case answers to the nearest cent. $11,066 27,425 3,127 6,496 a. Determine the single plantwide factory overhead rate. $ 15,396 8,661 $72,171 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 $ Processing Hours Per Case 0.12 0.15 0.10 Per-Case Factory Overhead
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text: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
Indirect labor
Factory electricity
Indirect materials
Selling expenses
Administrative expenses
Total costs
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:
Tortilla chips
Potato chips
Pretzels
Total
3,300
2,100
1,800
7,200
If required, round all per-case answers to the
nearest cent.
Budgeted Volume
(Cases)
Tortilla chips
Potato chips
Pretzels
$11,066
27,425
3,127
6,496
15,396
8,661
$72,171
a. Determine the single plantwide factory overhead
rate.
$
Total
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.
Processing Hours
Per Case
Total
0.12
0.15
0.10
Factory Overhead
Per-Case
Factory Overhead
Expert Solution
Step 1 Introduction
Factory Overhead Rate: A manufacturing overhead rate is the typical amount of factory overhead costs that are charged to each individual unit of output. Accounting on an accrual basis requires this information in order to attribute manufacturing overhead expenses to units that have been sold as well as units that are kept in inventory.
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