Question

CALCULATOR PRINTER VERSION BACK NEXT Exercise 17-05a-c (Video) (Part Level Submission) Bonita Corporation manufactures safes-large mobile safes, and large walk-in stationary bank safes. As part of its annual budgeting process, Bonita is analyzing the profitability of its two products. Part of this analysis involves estimating the amount of overhead to be allocated to each product line. The information shown below relates to overhead Mobile Safes Walk-In Sales Units planned for production 200 50 Material moves per product line 300 200 Purchase orders per product line 450 350 Direct labor hours per product line 800 1,700 The total estimated manufacturing overhead was $276,000. Under traditional costing (which assigns overhead on the basis of direct labor hours), what amount of manufacturing overhead costs are assigned to: (Round answers to 2 decimal places,.. 12.25.) 1) One mobile safe per unit (2) Ce walk-in safe per unit Attempts: 0 of 2 used SAVE FOR LATER SUBMIT ANSWER (61) The parts of this question must be completed in order. This part will be available when you complete the part above. (62) The parts of this question must be completed in order. This part will be available when you complete the part above

Answer 1

Solution:

Total direct labor hours = 800 + 1700 = 2500 hours

Overhead Application rate = $276000 / 2500 = $110.40

Overhead assigned to one mobile safe = Total overhead applied / Number of units

=($110.40*800) / 200 = $441.60 per unit

Overhead assigned to one Walk in safe = Total overhead applied / Number of units

=($110.40*1700) / 50 = $3,753.60