The Aleutian Company uses departmental overhead rates. The Fabrication Department uses machine hours for an allocation base, and
the Assembly Department uses labor hours. What is the Assembly Department overhead rate per labor hour
1 answer:
Answer:
$4.425 per labor hour
Explanation:
Note: The full question has been attached as picture
Product Rings Labor Hours = 1030 units x 4 labor hours per unit
Product Rings Labor Hours = 4,120 hours
Product Dings Labor Hours = 1810 units x 7 Labor hour per unit
Product Dings Labor Hours = 12,670 hours
Hence, the total Labor Hours = 4,120 hours + 12,670 hours = 16,790 hours
The total Assembly Department Overhead is estimated to be $74,300. Hence, the Assembly Department Overhead rate per labor hour = Total Overhead / Total Labor Hours
Assembly Department Overhead rate = $74,300 / 16,790
Assembly Department Overhead rate = $4.425
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Answer:
Cost per unit of widget produced = $6.52
Explanation:
As for the provided information:
Total units produced = 4,600 units
Total cost of production = costs for Department 1 + Department 2 + Department 3
= $18,000 + $8,000 + $4,000 = $30,000
It does not matter how many units are sold as the cost of sales will include, selling and administrative cost also.
Therefore, all the cost will be considered.
Thus total cost of production = $30,000 for 4,600 units.
Cost per unit of widget =