Answer:
Instructions are below.
Explanation:
Giving the following information:
Estimated costs:
fabrication= $386,400
assembly= $207,900
setup= $112,000
inspection= $280,500.
Fabrication Assembly Setup Inspection
Speedboat: 1,200 dlh 1,800 dlh 60 setups 600 inspections
Bass boat: 1,800 1,200 100 200
3,000 dlh 3,000 dlh 160 setups 800 inspections
First, we need to calculate the overhead rate for each activity:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
fabrication= 386,400/3,000= $128.8 per direct labor hour
assembly= 207,900/3,000= $69.3 per direct labor hour
setup= 112,000/160= $700 per setup
inspection= 280,500/800= $350.63 per inspection
Now, we can allocate overhead to each product:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Speedboat= 1,200*128.8 + 1,800*69.3 + 60*700 + 600*350.63
Speedboat= $531,678
Bass boat= 1,800* 128.8 + 1,200*69.3 + 100*700 + 200*350.63
Bass boat= 455,126
