Exercise 4 (Chapter 12)-Allocating overhead costs among products Harrison Hats C
ID: 2591418 • Letter: E
Question
Exercise 4 (Chapter 12)-Allocating overhead costs among products Harrison Hats Corporation manufactures three different models of hats: Vogue, Beauty, and Glamour. Harrison expects to incur $480,000 of overhead cost during the next fiscal year. Other budget information follows: Vogue Beauty Glamour Total Direct labor hours Machine hours 2,000 4,000 6,00012,000 1,200 1,4001,400 4,000 Required: a. Use direct labor hours as the cost driver to calculate the allocation rate and the budgeted overhead cost for each product. Use machine hours as the cost driver to calculate the allocation rate and the budgeted overhead cost for each product. b.Explanation / Answer
Dear Student Thank you for using Chegg Please find below the answer and please give thumbs up Statementshowing Computations Paticulars Labour Hours Machine hours Budgeted Overhead cost 480,000.00 480,000.00 Budgeted Hours 12,000.00 4,000.00 Budgeted rate or allocation rate= O/H cost/ Hours 40.00 120.00 a) DL Hours Vogue Beauty Glamour Total No of DL Hours 2,000.00 4,000.00 6,000.00 12,000.00 Allocation rate 40.00 40.00 40.00 40.00 Budgeted Overhead 80,000.00 160,000.00 240,000.00 480,000.00 b) Machine Hours Vogue Beauty Glamour Total No of Machine Hours 1,200.00 1,400.00 1,400.00 4,000.00 Allocation rate 120.00 120.00 120.00 120.00 Budgeted Overhead 144,000.00 168,000.00 168,000.00 480,000.00
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.