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Estimate the overhead costs of each of the three products

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Reference no: EM132607601

The following annual data relate to Facsimile Printing Pty Ltd:

Budgeted machine hours                  15,000

Budgeted direct labour hours            30,000

Budgeted direct labour cost             $420,000

Budgeted manufacturing overhead      $546,000

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

Business cards                            Wedding              Invitations               Promotion 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.

Required:

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

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

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

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

Reference no: EM132607601

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