Question

Single Plantwide Factory Overhead Rate Salty Sensations Snacks Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period: Factory depreciation $23,909 Indirect labor 59,251 Factory electricity Indirect materials Selling expenses Administrative expenses 6,757 14,033 33,264 18,711 Total costs $155,925 Factory overhead is allocated to the three products on the basis of processing hours. The products had the following production budget and processing hours per case: Budgeted Volume (Cases) 7,200 Processing Hours Per Case Tortilla chips 0.12 4,500 Potato chips Pretzels 0.10 0.15 5,100 Total 16,800 If required, round all per-case answers to the nearest cent.

Answer 1

Factory Depreciation	23909
Indirect labor	59251
Factory Electricity	6757
Indirect materials	14033
Total budgeted factory overhead	103950
Tortilla chips	864	=7200*0.12
Potato chips	450	=4500*0.10
Pretzels	765	=5100*0.15
Total processing hours	2079
a
Total budgeted factory overhead	103950
Divide by Processing hours	2079
Plantwide factory overhead rate	50.00	per processing hour
b
	Total factory overhead	Per-case factory overhead
Tortilla chips	43200	6.00
Potato chips	22500	5.00
Pretzels	38250	7.50
Total	103950
Workings for (b)
	Total factory overhead	Per-case factory overhead
Tortilla chips	=864*50	=43200/7200
Potato chips	=450*50	=22500/4500
Pretzels	=765*50	=38250/5100