Using the department factory overhead allocation rates

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Reference no: EM13789042

The total factory overhead for Rowland Company is budgeted for the year at $652,000 and divided into two departments: Fabrication $460,000 and Assembly $192,000. Rowland manufactures two products: treadmills and weight machines. Each treadmill requires 3 direct labor hours in Fabrication and 1 direct labor hour in Assembly. Each weight machine requires 2 direct labor hours in Fabrication and 5 direct labor hours in Assembly. Each product is budgeted for 4,000 units of production for the year.

Determine the factory overhead allocated per unit for each weight machine, using the department factory overhead allocation rates.

a. $77.00

b. $163.00

c. $86.00

d. $81.50

Reference no: EM13789042

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