Question : 61. The Nite Lite Factory produces two products – small lamps : 1233960

 

61. The Nite Lite Factory produces two products – small lamps and desk lamps. It has two separate departments – finishing and production. The overhead budget for the finishing department is $550,000, using 500,000 direct labor hours. The overhead budget for the production department is $400,000 using 80,000 direct labor hours. If the budget estimates that a desk lamp will require 1 hours of finishing and 2 hours of production, what is the total amount of factory overhead to be allocated to desk lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours, if 26,000 units are produced? A. $540,000B. $300,000C. $400,000D. $288,600

62. Using multiple department factory overhead rates instead of a single plant-wide factory overhead rate: A. results in more accurate product costsB. results in distorted product costsC. is simpler and less costlyD. applies overhead costs to all departments equally

63. Zinn Co. uses 3 machine hours and 1 direct labor hour to produce Product X. It uses 4 machine hours and 8 direct labor hours to produce Product Y. Zinn’s Assembly and Finishing Departments have factory overhead rates of $240 per machine hour and $160 per direct labor hour, respectively. How much overhead cost will be charged to the two products? A. Product X = $240; Product Y = $160B. Product X = $400; Product Y = $400C. Product X = $880; Product Y = $2,240D. Product X = $720; Product Y = $1,280

64. Using a plant-wide factory overhead rate distorts product costs when: A. products require different ratios of allocation-base usage in each production departmentB. significant differences exist in the factory overhead rates used across different production departmentsC. both A and B existD. either A or B exist

65. Stewart Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plant-wide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. From the following information, determine the overhead rate in the Painting Department for each unit of Product B if the company uses a multiple department rate system. 

 

Overhead

Direct LaborHours (dlh)

Product

 A 

 B 

Painting Dept.

$248,000

10,000 dlh

  16 dlh

   4 dlh

Finishing Dept.

  72,000

10,000    

   4   

  16

   Totals

$320,000

20,000 dlh

  20 dlh

  20 dlh

 

========

==========

======

  ======

 

 

 

 

 

 A. $12.40 per dlhB. $24.80 per dlhC. $7.20 per dlhD. $3.60 per dlh

66. Stewart Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plant-wide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. From the following information, determine the overhead rate in the Finishing Department for each unit of Product A if the company uses a multiple department rate system. 

 

Overhead

Direct LaborHours (dlh)

Product

 A 

 B 

Painting Dept.

$248,000

10,000 dlh

  16 dlh

   4 dlh

Finishing Dept.

  72,000

10,000    

   4   

  16

   Totals

$320,000

20,000 dlh

  20 dlh

  20 dlh

 

========

==========

======

  ======

 

 

 

 

 

 A. $24.80 per dlhB. $12.40 per dlhC. $3.60 per dlhD. $7.20 per dlh

67. Stewart Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plant-wide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. From the following information, determine the overhead from both production departments allocated to each unit of Product A if the company uses a multiple department rate system. 

 

Overhead

Direct LaborHours (dlh)

Product

 A 

 B 

Painting Dept.

$248,000

10,000 dlh

  16 dlh

   4 dlh

Finishing Dept.

  72,000

10,000    

   4   

  16

   Totals

$320,000

20,000 dlh

  20 dlh

  20 dlh

 

========

==========

======

  ======

 

 

 

 

 

 A. $396.80 per unitB. $425.60 per unitC. $320.00 per unitD. $214.40 per unit

68. Stewart Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plant-wide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. From the following information, determine the overhead from both production departments allocated to each unit of Product B if the company uses a multiple department rate system. 

 

Overhead

Direct LaborHours (dlh)

Product

 A 

 B 

Painting Dept.

$248,000

10,000 dlh

  16 dlh

   4 dlh

Finishing Dept.

  72,000

10,000    

   4   

  16

   Totals

$320,000

20,000 dlh

  20 dlh

  20 dlh

 

========

==========

======

  ======

 

 

 

 

 

 A. $425.60 per unitB. $99.20 per unitC. $214.40 per unitD. $320.00 per unit

69. The Delph Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and assembly. Data for the products and departments are listed below.

Product

Number of units

Labor hrs per unit

Machine hours per unit

Blinks

1,000

4

5

Dinks

2,000

2

8

 

 

 

 

All of the Machine hours take place in the Fabrication department, which has an estimated overhead of $84,000. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $72,000.The Delph Company uses a departmental overhead rates. The fabrication department uses machine hours for an allocation base, and the assembly department uses labor hours. What is the assembly department overhead rate per labor hour? A. $9.00B. $19.50C. $24.00D. $7.00

70. The Delph Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and assembly. Data for the products and departments are listed below.

Product

Number of units

Labor hrs per unit

Machine hours per unit

Blinks

1,000

4

5

Dinks

2,000

2

8

 

 

 

 

All of the Machine hours take place in the Fabrication department, which has an estimated overhead of $84,000. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $72,000.The Delph Company uses a departmental overhead rates. The fabrication department uses machine hours for an allocation base, and the assembly department uses labor hours. What is the overhead cost per unit for Blinks? A. $50B. $56C. $44D. $64

 

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