<u>Answer:</u>
<u>Determine the plantwide overhead rate for Laval using direct labor hours as a base.
</u>
1.
Estimated overhead costs $800,000 $1.60 per direct labor hour
Estimated direct labor hours 500,000
2.
<u>Determine the total manufacturing cost per unit for the aluminum desk lamp using the plantwide overhead rate.
</u>
Direct Labor - Assembly $188,500
Direct Labor - Fabricating 395,200
Direct materials 270,000
Overhead 34,720
Total manufacturing costs 888,420
Units produced 22000
Manufacturing cost per unit 40.38
3. <u>Compute departmental overhead rates based on machine hours in the fabricating department and direct labor hours in the assembly department. </u>
Departmental overhead rate
Fabricating 390000/152000 = 2.57 MH
Assembly 410000/290000 = 1.41 DLH
4. <u>Use departmental overhead rates from requirement 3 to determine the total manufacturing cost per unit for the aluminum desk lamps. </u>
Direct materials 270000
Direct labor
Fabricating 188500
Assembly 395200
583700
0
Overhead
Fabricating (15000*2.57) 38550
Assembly (15200*1.41) 21432
59982
0
Total manufacturing cost 913682
Units produced 22000
Manufacturing cost per unit 41.53 per unit
