Homework Answers
Answer a)
| Product | Allocation Rate | × | Weight of Base | = | Allocated Cost |
| Vogue | $43 | × | 4,800 | = | $206,400 |
| Beauty | $43 | × | 6,800 | = | $292,400 |
| Glamour | $43 | × | 3,400 | = | $146,200 |
| Total | = | $645,000 |
Explanation :
Total Overhead Cost = $645,000 (Given)
Total Number of Direct Labor Hours = 15,000 (Given)
Overhead Allocation Rate = Total Overhead Cost / Total Number of Direct Labor Hours
= $645,000 / 15,000
= $43
Answer b)
| Product | Allocation Rate | × | Weight of Base | = | Allocated Cost |
| Vogue | $150 | × | 1,200 | = | $180,000 |
| Beauty | $150 | × | 1,400 | = | $210,000 |
| Glamour | $150 | × | 1,700 | = | $255,000 |
| Total | = | $645,000 |
Explanation :
Total Overhead Cost = $645,000 (Given)
Total Machine Hours = 4,300 (Given)
Overhead Allocation Rate = Total Overhead Cost / Total Machine Hours
= $645,000 / 4,300
= $150
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