Chapter 4, Problem 1PA

1. A

To determine

Single plant-wide factory overhead rate: The rate at which the factory or manufacturing overheads are allocated to products is referred to as single plant-wide factory overhead rate.

Formula to compute single plant-wide overhead rate:

$\begin{array}{l}\text{Single plant-wide }\\ \text{overhead rate}\end{array}\}\text{ = }\frac{\text{Total budgeted factory overhead}}{\text{Total budgeted plant-wide allocation base}}$

To compute: The total number of budgeted direct labor hours (DLH) for Company OCC

2. A

To determine

To compute: The factory overhead allocated to each product using single plant-wide overhead rate, assuming DLH as the allocation base