Question

Campbell Corporation expects to incur indirect overhead costs of $163,150 per month and direct manufacturing costs of $23 per unit. The expected production activity for the first four months of the year are as follows. Estimated production in units January February March 4,800 8,600 4,600 April 7,100 Required a. Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. b. Allocate overhead costs to each month using the overhead rate computed in Requirement a c. Calculate the total cost per unit for each month using the overhead allocated in Requirement b. Complete this question by entering your answers in the tabs below. Required A Required B Required C Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. Predetermined overhead rate per unit Required A Required B Required Allocate overhead costs to each month using the overhead rate computed in Requirement a. Month Allocated Cost January February March April Required A Required B Required C Calculate the total cost per unit for each month using the overhead allocated in Requirement b. January 4,800 February 8,600 March 4,600 April 7,100 Month Number of units Expected cost Overhead Direct costs Total cost Cost per unit

Answer 1

Required A
Predetermined overhead rate			6.5	per unit
estimated overhead cost					163150
divided by number of units produced					25100
predetermined overhead rate					6.5
Required B
	Allocated
Month	cost
Jan	31200
Feb	55900
March	29900
April	46150
allocated cost=		overhead rate*units
Required C
Month		Jan	Feb	March	April
number of units		4800	8600	4600	7100
Expected cost
overhead		31200	55900	29900	46150
Direct costs		110400	197800	105800	163300
total cost		141600	253700	135700	209450
cost per unit		29.5	29.5	29.5	29.5