Question

t-unit factory the last line of your report, rounded to one decimal place. D What does the report in (C) indicate to you? obj. 3 EX 4-5 Multiple production department factory overhead rate method Obj. 2 s tortilla chips, B. Small glove, Performance Gloves, Inc. produces three sizes of sports gloves: small, medium, and large. A 59.20 per unit glove pattern is first stenciled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the glove is cut and sewed together. Performance Gloves uses the multiple production department factory overhead rate method of or the upcoming allocating factory overhead costs. Its factory overhead costs were budgeted as follows: Pattern Department overhead Cut and Sew Department overhead $ 216,000 960,000 $1.176.000 SON ME HOWEXCEL TEMPLATE Total The direct labor estimated for each production department was as follows: Pattern Department Cut and Sew Department 36,000 direct labor hours 60,000 96,000 direct labor hours ing hours. The Total Direct labor hours are used to allocate the production department overhead to the prod- ucts. The direct labor hours per unit for each product for each production department were obtained from the engineering records as follows: Production Departments Pattern Department Cut and Sew Department Direct labor hours per unit Small Glove 0.20 0.50 0.70 Medium Glove 0.24 0.60 Large Glove 0.30 0.72 1.02 0.84 A. Determine the two production department factory overhead rates. B. Use the two production department factory overhead rates to determine the factory over- case factory accounting head per unit for each product.

Answer 1

A.

Pattern department overhead = Overhead amount/Direct labor hours

= 216,000/36,000

= $6

Cut and sew department overhead = Overhead amount/Direct labor hours

= 960,000/60,000

= $16

B.

Calculation of factory overhead rate per unit for each product

	Small glove	Medium glove	Large glove
Pattern department overhead	0.20 x 6 = 1.20	0.24 x 6 = 1.44	0.30 x 6 = 1.80
Cut and sew department overhead	0.50 x 16 = 8	0.60 x 16 = 9.60	0.72 x 16 = 11.52
factory overhead rate per unit for each product	$9.20	$11.04	$13.32

Kindly give a positive rating if you are satisfied with the answer. Feel free to ask if you have any doubts. Thanks.