Reference no: EM133135798
Question - Single Plantwide 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 $28,098
Indirect labor 69,635
Factory electricity 7,941
Indirect materials 16,492
Selling expenses 39,093
Administrative expenses 21,990
Total costs $183,249
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:
|
Budgeted Volume
(Cases)
|
Processing Hours
Per Case
|
|
Tortilla chips
|
6,000
|
0.10
|
|
Potato chips
|
3,300
|
0.12
|
|
Pretzels
|
5,700
|
0.15
|
|
Total
|
15,000
|
|
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.