Reference no: EM133098967
Question - Single Plant-wide Factory Overhead Rate - Scrumptious Snacks Inc. manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period:
Factory depreciation $19,615
Indirect labor 48,612
Factory electricity 5,543
Indirect materials 11,514
Selling expenses 27,291
Administrative expenses 15,351
Total costs $127,926
Factory overhead is allocated to the three products on the basis of processing hours. The products had the following production budget and processing hours per case:
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Budgeted Volume (Cases)
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Processing Hours Per Case
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Tortilla chips
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4,200
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0.15
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Potato chips
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7,200
|
0.10
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Pretzels
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4,200
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0.12
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Total
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15,600
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If required, round all per-case answers to the nearest cent.
Required -
a. Determine the single plantwide factory overhead rate.
b. Use the overhead rate in (a) to determine the amount of total and per-case overhead allocated to each of the three products under generally accepted accounting principles.