Question

Single Plantwide Factory Overhead Rate wide Fa The total factory overhead for Urban Styles, Inc, is budgeted for the year at $552,000. Urban Styles manufactures two types of men's pants: jeans and khakis. The jeans and khakis each require four direct labor hours for manufacture. Each product is budgeted for 4,000 units of production for the year When required, round all per unit answers to the nearest cent a. Determine the total number of budgeted direct labor hours for the year direct labor hours b. Determine the single plantwide factory overhead rate. per dih c. Determine the factory overhead allocated per unit for each product using the single plantwide factory overhead rate. per unit Jeans hakis per unit

Answer 1

Answer

• All working forms part of the answer
• Requirement [a]
  = 32,000 Direct labor hours

		Jeans	Khakhis	Total
A	Budgeted units	4,000	4,000	8,000
B	DLHs per unit	4	4
C = A x B	Total Direct Labor hours	16,000	16,000	32,000 DLHs

• Requirement [b]
  Plantwide Overhead rate = $ 552,000 / 32,000 DLHs
  = $ 17.25 per DLH
• Requirement [c]
  Jeans = $ 69 per unit [4 hrs x $ 17.25]
  Khakis = $ 69 per unit [4 hrs x $ 17.25]