Multiple Production Department Factory Overhead Rates Spotted Cow Dairy Company manufactures three products-whole milk, skim milk,...

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Multiple Production Department Factory Overhead Rates Spotted Cow Dairy Company manufactures three products-whole milk, skim

Required 1. Determine the multiple production department factory overhead vates using machine hours for the leading Departmen

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Answer 1

Answer #1

1	Multiple factory overhead rates:
	Blending department=Estimated factory overhead/Estimated machine hours=178200/1620=$ 110 per machine hour
	Packing department=Estimated factory overhead/Estimated direct labor hours=121500/1620=$75 per direct labor hour

2	Factory overhead allocated
	Blending department=Multiple factory overhead rate*Machine hours
	Packing department=Multiple factory overhead rate*Direct labor hours

		Whole milk	Skim milk	Cream
	Blending department factory overhead	71500	78100	28600
		(650*110)	(710*110)	(260*110)
	Packing department factory overhead	35250	22500	9750
		(470*75)	(300*75)	(130*75)
	Total factory overhead	106750	100600	38350

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Answer 2

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