Question

Laval produces lamps and home lighting fixtures. Its most popular product is a brushed aluminum desk lamp. This lamp is made from components shaped in the fabricating deportment and assembled in the assembly department. Information related to the 24,000 desk lamps produced bnnually follows. $ 270,000 Direct materials Direct labor Fabricating department (7,000 DLH * $23 per DLH) Assembly department (15,800 DLH X $22 per DLH) Machine hours Fabricating department Assembly department $161,000 $347,600 15,000 MH 21, 250 MH Expected overhead cost and related data for the two production departments follow. Direct labor hours Machine hours Overhead cost Fabricating 110,000 DLH 173,000 MH $390,000 Assembly 345,000 DLH 132,000 MH $450,000 Required 1. Determine the plantwide overhead rate for Laval using direct labor hours as a base. 2. Determine the total manufacturing cost per unit for the aluminum desk lamp using the plantwide overhead rate. 3. Compute departmental overhead rates based on machine hours in the fabricating department and direct labor hours in the assembly department. 4. Use departmental overhead rates from requirement 3 to determine the total manufacturing cost per unit for the aluminum desk lamps. Complete this question by entering your answers in the tabs below.

Answer 1

Answers Total direct labor hours for both departments. 110000+ 345000 455000 DLH Total overhead cost = 390000 + 460000 = 840000 plantwide overhead crate on the basis of direct labor houses - 840000 455000 = 1.84 / DLH Computation of manufacturing Overhead rate- Laval Cost lunit - plantcoide 270000 Direct material fabricating department Assembly Applied overhead 161000 - 347600 41952

Apply overhead - (7000 + 15800Jx 1.44 29800 x 1.84 : 41952. Now, Total manufacturing Cost will be 270000 161000 347600 41952 820552 Total manufacturing cost Now, Total dest lamp produced - 24000 Manufacturing Cost per cinit 820552 24000 2 34.18

© Computation Computation of departmental overhead role: I fabricating I Assembly Overhead test of department 390000 450000 Allocation base MH DLH Total machine howers 173000 Total direct labor hours 345000 Overhead rate of department $2.95 $1.30 © Computation of manufacturing Cost / unit departmental overhead crate - Laund:- Dialect material - 270000 Fabricating department 161006 Assembly department - Applied over head :- Fabricating department 15000 2.25 = 33750 347600

Assembly department -16000 x 1.30 20800 Total manufacturing Cost = 833150 Total dest camp produced = 24000 Manufacturing cost [unit - 883150 24000 2 34.71