Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours. Direct Overhead Labor Hours (dlh) Painting Dept. Finishing Dept. Totals Product A 16 dlh $248,000 72,000 $320,000 Using a single plantwide rate, the factory overhead allocated per unit of Product B is O a. $640 O b. $496 Oc. $320 O d. $144 10,000 dlh 10,000 20,000 dlh 4 Product B 20 dih 4 dlh 16 20 dlh

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However,
management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct
labor hours.
Direct
Overhead Labor Hours (dlh)
$248,000
72,000
$320,000
10,000 dlh
10,000
20,000 dlh
Product A
Painting Dept.
Finishing Dept.
Totals
Using a single plantwide rate, the factory overhead allocated per unit of Product B is
O a. $640
O b. $496
O c. $320
C.
O d. $144
16 dlh
4
Product B
4 dlh
20 dlh
16
20 dlh
Ⓒ
Transcribed Image Text:Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours. Direct Overhead Labor Hours (dlh) $248,000 72,000 $320,000 10,000 dlh 10,000 20,000 dlh Product A Painting Dept. Finishing Dept. Totals Using a single plantwide rate, the factory overhead allocated per unit of Product B is O a. $640 O b. $496 O c. $320 C. O d. $144 16 dlh 4 Product B 4 dlh 20 dlh 16 20 dlh Ⓒ
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