Question : 60. Challenger Factory produces two similar products – regular widgets and : 1227096

60. Challenger Factory produces two similar products – regular widgets and deluxe widgets. The total plant overhead budget is $675,000 with 300,000 estimated direct labor hours. It is further estimated that deluxe widget production will need 3 direct labor hours for each unit and regular widget production will require 2 direct labor hours for each unit.

Using the single plantwide factory overhead rate with an allocation base of direct labor hours, how much factory overhead will be allocated to the deluxe widget production if the budgeted production for the period is 50,000 units and actual production for the period is 58,000 units? 
A. $391,500
B. $225,000
C. $261,000
D. $337,500

61. The Kaumajet Factory produces two products – table 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 table lamp will require 2 hours of finishing and 1 hours of production, how much factory overhead will be allocated to each unit of table lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours? 
A. $6.33
B. $4.91
C. $5.00
D. $7.20

62. The Kaumajet Factory produces two products – table 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, how much factory overhead will be allocated to each unit of desk lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours? 
A. $11.10
B. $4.91
C. $5.00
D. $7.20

63. The Kaumajet Factory produces two products – table 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 table lamp will require 2 hours of finishing and 1 hours of production, what is the total amount of factory overhead to be allocated to table lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours, if 75,000 units are produced? 
A. $368,250
B. $540,000
C. $832,500
D. $475,000

64. The Kaumajet Factory produces two products – table 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. $540,000
B. $187,200
C. $475,000
D. $288,600

65. Using multiple department factory overhead rates instead of a single plantwide factory overhead rate: 
A. results in more accurate product costs
B. results in distorted product costs
C. is simpler and less expensive than a plantwide rate
D. applies overhead costs to all departments equally

66. Scoresby 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. Scoresby’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 = $1,600; Product Y = $4,800
B. Product X = $400; Product Y = $400
C. Product X = $880; Product Y = $2,240
D. Product X = $720; Product Y = $1,280

67. Using a plantwide factory overhead rate distorts product costs when: 
A. products require different ratios of allocation-base usage in each production department
B. significant differences exist in the factory overhead rates used across different production departments
C. both A and B are true
D. neither A nor B are true

68. The Aleutian Company produces two products, Rings and Dings. 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

Rings

1,000

4

6

Dings

2,000

3

9

All of the machine hours take place in the Fabrication department, which has an estimated overhead of $90,000. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $105,000.

The Aleutian 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. $10.50
B. $19.50
C. $3.75
D. $4.38

69. The Aleutian Company produces two products, Rings and Dings. 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

Rings

1,000

4

6

Dings

2,000

3

9

All of the machine hours take place in the Fabrication department, which has an estimated overhead of $90,000. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $105,000.

The Aleutian 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 Rings? 
A. $65.25
B. $23.25
C. $44.10
D. $64.50