FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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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
Indirect labor
Factory electricity
Indirect materials
Selling expenses
Administrative expenses
Total costs
$24,819
61,509
7,014
14,568
34,531
19,424
$161,865
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
Processing Hours
(Cases)
per Case
Tortilla chips
6,000
0.12
Potato chips
4,200
0.10
Pretzels
3,300
0.15
Total
13,500
If required, round all per-case answers to the nearest cent.
Determine the single plantwide factory overhead rate.
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
Per Unit
Factory Overhead
Factory Overhead Case
Tortilla chips
Potato chips
Pretzels
Total
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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 $24,819 61,509 7,014 14,568 34,531 19,424 $161,865 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 Processing Hours (Cases) per Case Tortilla chips 6,000 0.12 Potato chips 4,200 0.10 Pretzels 3,300 0.15 Total 13,500 If required, round all per-case answers to the nearest cent. Determine the single plantwide factory overhead rate. 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 Per Unit Factory Overhead Factory Overhead Case Tortilla chips Potato chips Pretzels Total
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