FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Textra produces parts for a machine manufacturer. Parts go through two departments, Molding and Trimming. The company budgets overhead cost of $265,000 in the Molding department and $225,000 in the Trimming department. The company budgets 16,000 machine hours (MH) in Molding and 25,000 direct labor hours (DLH) in Trimming. Actual production information follows.
 

  Number of Units Molding Department Trimming Department
Hours per Unit Total Hours Hours per Unit Total Hours
Part Z 3,000 2.0 MH per unit 6,000 MH 3 DLH per unit 9,000 DLH
Part X 4,000 2.5 MH per unit 10,000 MH 4 DLH per unit 16,000 DLH
Totals       16,000 MH     25,000 DLH

 

Required:
1. 
Compute the plantwide overhead rate using direct labor hours as the allocation base.
2. Determine the overhead cost per unit for each part using the plantwide rate.

etermine the overhead cost per unit for each part using the plantwide rate. (Round "Plantwide Overhead Rat
decimal places.)
Part
Z
X
Plantwide Overhead Rate
Activity Usage
Required 1
Overhead cost per
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Transcribed Image Text:etermine the overhead cost per unit for each part using the plantwide rate. (Round "Plantwide Overhead Rat decimal places.) Part Z X Plantwide Overhead Rate Activity Usage Required 1 Overhead cost per
Required 1 Required 2
Compute the plantwide overhead rate using direct labor hours as the allocation base.
Budgeted overhead costs
Budgeted overhead costs
0
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Transcribed Image Text:Required 1 Required 2 Compute the plantwide overhead rate using direct labor hours as the allocation base. Budgeted overhead costs Budgeted overhead costs 0
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