Question

need help on C

Concord Artworks creates hand-painted picture frames. The frames are cast from resin in an automated process. Once the casting is done, talented artisans hand-paint one of fifteen designs on each frame. In the final assembly process, a worker inserts the glass pane and attaches the backing to the frame. Concord's budget for the current year, along with the production requirements for two of the frames it produces, are as follows: Direct labor hours Machine hours Manufacturing overhead cost Department Casting Painting 50,000 18,000 $198,000 $320,000 Assembly 14,000 2,000 $64.400 Seasons of Fun Frame Casting Direct labor hours Machine hours Department Painting Assembly 1 0.25 0.50 1.50 Birth Announcement Frame Casting Department Painting Assembly 1.50 0.50 0.20 Direct labor hours Machine hours 0.80

Answer 1

c) Predetermined overhead application rate = Total Estimated Overhead cost / Total Machine hours (MH)

= ($198,000+$320,000+$64,400) / (18,000 MH +2000 MH)

= $582,600 / 20,000 DLH

= $29.13 Per MH

Amount of overhead applied = Machine hours Per frame * overhead application rate

Seasons of Fun frame:

= (1.5 MH + 0.50 DLH) * $29.13

= $58.26 Per frame

Birth Announcement Frame:

= (0.8 MH + 0.2 MH) * $29.13

= $29.13 Per frame