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Sagot :
The production department factory overhead rates for Cut and sew department is 89 and Pattern is 67.
Factory overhead rate
a. Pattern Department
Factory overhead rate=Total Overhead Cost/Direct Labor Hours
Factory overhead rate= 140,700/2700
Factory overhead rate=67
Cut and sew Department
Factory overhead rate=231,400/2600
Factory overhead rate=89
b. Factory overhead per unit
Pattern Department:
Small glove=.04 x 67
Small glove=2.68
Medium glove= .05 x 67
Medium glove=3.35
Large glove= .06 x 67
Large glove=4.02
Cut and sew Department:
Small glove=.07 x 89
Small glove=6.23
Medium glove=.09 x 89
Medium glove=8.01
Large glove=.11 x 89
Large glove=9.79
Therefore the production department factory overhead rates for Cut and sew department is 89 and Pattern is 67.
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The complete question is:
Handy Leather, Inc., produces three sizes of sports gloves: small,
medium, and large. A glove pattern is first stenciled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the glove is cut and sewed together. Handy Leather uses the multiple production department factory overhead rate method of allocating factory overhead costs. Its factory overhead costs were budgeted as follows:
Pattern department Overhead $140,700
Cut and sew Department overhead $231,400
Total $372100
Direct labor labor estimated for each department was as follows:
Pattern Dept. - 2100 direct labor hours
Cut and Sew Department 2600
Total 4700 direct labor hours
Direct labor hours are used to allocate the production department overhead to the products. The direct labor hours per unit for each product for each production department were obtained from the engineering records as follows:
Production Departments Small Glove Medium Glove Large Glove
Pattern dept. 0.04 0.05 0.06
cut and sew dept. 0.07 0.09 0.11
direct labor hours per unit 0.11 0.14 0.17
If required, round all per unit answers to the nearest cent.
a. Determine the two production department factory overhead rates.
Cut and sew department and Pattern
b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product.
small glove, medium glove and large glove
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