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 $16,513 Indirect labor 40,924 Factory electricity 4,667 Indirect materials 9,692 Selling expenses 22,975 Administrative expenses 12,923 Total costs $107,694 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 3,900 0.12 Pretzels 1,800 0.15 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 $ $ Potato chips $ $ Pretzels $ $ Total $ $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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	$16,513
Indirect labor	40,924
Factory electricity	4,667
Indirect materials	9,692
Selling expenses	22,975
Administrative expenses	12,923
	Total costs	$107,694

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		3,900		0.12
Pretzels		1,800		0.15
	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.