Question : 159.A company estimates that overhead costs for the next year : 1258538

159.A company estimates that overhead costs for the next year will be $7,200,000 for indirect labor, $400,000 for factory utilities, and $43,000 for depreciation on factory machinery. The company uses direct labor hours as its overhead allocation base. If 955,375 direct labor hours are planned for this next year, what is the company’s plantwide overhead rate?   

160.A company estimates that overhead costs for the next year will be $3,600,000 for indirect labor, $200,000 for factory utilities, and $21,500 for depreciation on factory machinery. The company uses machine hours as its overhead allocation base. If 764,300 machine hours are planned for this next year, what is the company’s plantwide overhead rate?   

161.A company has two products: A and B. It uses a plantwide overhead allocation method based on activity 2 and has prepared the following analysis showing budgeted costs and activities. Use this information to compute (a) the company’s plantwide overhead rate and (b) the amount of overhead allocated to Product A. 

Budgeted Activity

Activity Cost PoolBudgetedOverhead CostProduct AProduct BTotal

Activity 1$160,0004001,6002,000

Activity 2$110,0002,0001,0003,000

Activity 3$180,0001,20010,80012,000

Total budgeted overhead$450,000

162.A company has two products: A and B. It uses activity-based costing and has prepared the following analysis showing budgeted costs and activities. Use this information to compute (a) the company’s overhead rates for each of the three activities and (b) the amount of overhead allocated to Product A. 

Budgeted Activity

Activity Cost PoolBudgetedOverhead CostProduct AProduct BTotal

Activity 1$160,0004001,6002,000

Activity 2$110,0002,0001,0003,000

Activity 3$180,0001,20010,80012,000

Total budgeted overhead$450,000

163.A company has two products: AA and BB. It uses a plantwide overhead allocation method based on activity 33 and has prepared the following analysis showing budgeted costs and activities. Use this information to compute the company’s plantwide overhead rate. 

Budgeted Activity

Activity Cost PoolBudgetedOverhead CostProduct AAProduct BBTotal

Activity 11$40,000100400500

Activity 22$55,000500250750

Activity 33$90,0003001,7002,000

Total budgeted overhead$185,000

164.A company expects next year’s overhead costs to be $400,000. During this time, the company also expects to produce 1,000,000 units, have 200,000 direct labor hours, and 800,000 machine hours.Make the following independent calculations.a. Compute a plantwide overhead rate using units of production as the allocation base.b. Compute a plantwide overhead rate using direct labor hours as the allocation base.c. Compute a plantwide overhead rate using machine hours as the allocation base.    

a. $400,000/1,000,000 units = $0.40 per unit of product b. $400,000/200,000 direct labor hours = $2 per DLH c. $400,000/800,000 machine hours = $0.50 per MH

165.Superior Products Manufacturing identified the following data in its two production departments. 

AssemblyFinishing

Manufacturing overhead costs$225,000$420,000

Direct labor hours worked6,600 DLH9,000 DLH

Machine hours used2,400 MH5,200 MH

Make the following independent calculations (Round to two decimals). a. Compute a plantwide overhead rate using machine hours as the allocation base. b. Compute a plantwide overhead rate using direct labor hours as the allocation base.