Question

NatureMade Snacks just received an order to produce 12,000 single-serving bags of gourmet, fancy-cut, sweet potato chips. The order will require 21 preparation hours and 36 cooking and draining hours. (Click the icon to view the relevant activity rates.) Read the requirements. 1. What is the total amount of manufacturing overhead that should be allocated to this order? Determine the basic formula needed to allocate overhead to this order, then compute the overhead allocated to each activity. Manufacturing overhead allocated i Reference Activity Activity Preparation Cooking and draining Packaging Cost Allocation Rate Base Units 60.00 29.00 0.10 per hour of preparation per hour of cooking and draining per unit packaged Choose from any drop-down list and then click Check Answer. S parts

Answer 1

Solution 1:

Activity Cost Allocation Rate * Usage of Base units = Manufacturing Overhead Allocated

Activity	Activity Cost Allocation Rate	Usage of Base Units		Manufacturing Overhead Allocated
Preparation	$60.00	21	Preparation Hours	$1,260.00
Cooking and Draining	$29.00	36	Cooking and Draining Hours	$1,044.00
Packaging	$0.10	12000	Units	$1,200.00
Total Manufacturing Overhead				$3,504.00