Question

Single Plantwide Factory Overhead Rate The total factory overhead for Bardot Marine Company is budgeted for the year at $3,277,500. Bardot Marine manufactures two types of boats: speedboats and bass boats. The speedboat and bass boat each require six direct labor hours for manufacture. Each product is budgeted for 11,500 units of production for the year. When required, round all per unit answers to the nearest cent. a. Determine the total number of budgeted direct labor hours for the year. direct labor hours b. Determine the single plantwide factory overhead rate. $ per dlh c. Determine the factory overhead allocated per unit for each product using the single plantwide factory overhead rate. Speedboat $ per unit Bass boat $ per unit

Answer 1

Answer:

(A) 138,000 direct labor hours

(B) $23.75 per direct labor hour

(C) $142.5 per unit for speedboat and $142.5 per unit for bass boat

Explanation:

(A) The number of direct hours for The speedboats can be calculated as follows

= 11,500 × 6

= 69,000

The number of direct hours for the bass boat can be calculated as follows

= 11,500 × 6

= 69,000

Total number of budgeted direct labor hours for the year is

= 69,000 + 69,000

= 138,000 direct labor hours

(B) The single plantwide factory overhead can be calculated as follows

= Budgeted overhead cost/total number of budgeted labor hours

= 3,277,500/138,000

= $23.75 per direct labor hour

(C) The factory overhead allocated or unit of each product can be calculated as follows

For speedboats

= 69,000 × 23.75

= 1,638,750

1,638,750/11,500

= $142.5 per unit

For bass boats

=69,000 × 23.75

= 1,638,750

1,638,750/11,50

= $142.5 per unit