Reference no: EM132982731

The following annual data relate to Facsimile Printing Pty Ltd:

Budgeted machine hours 15000

Budgered direct labour hours 30000

Budgeted direct labour cost $420000

Budgeted manutàcturing overhead $546000

During the month of June the firm worked on three products- business cards, wedding invitations and promotion flyers- using the following inputs:

                                                          Buslness cards              Weddlng Invltatlons               Promotlon flyers

Actual machine hours                            600                        300                                      200

Actual direct labour hours                        800                          600                                      400

Actual manufacturing overhead costs for June were $51 000 and the actual direct labour rate was $22.50 per hour.

Problem : Assume that the firm uses machine hours as its overhead cost driver:

Problem 1. Calculate the firm's predetermined plantwide overhead rate.

Problem 2. Estimate the overhead costs of each of the three products.

Problem 3. Compare the actual overhead cost to the amount of overhead applied to the three products in June.