Answered: JYD Corporation has two departments,…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter4: Accounting For Factory Overhead

Section: Chapter Questions

Problem 16P: Rockford Company has four departmental accounts: Building Maintenance, General Factory Overhead,...

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Question

JYD Corporation has two departments, Assembly and Finishing. The following are data available for two departments in 2021:

	Assembly	Finishing
Machine hours per unit	10 hours	5 hours
Direct labor hours	2 hours	1 hour
Budgeted (Estimated) Factory Overhead	$325,000	$175,000
Budgeted machine hours	15,000 hours	2,500 hours
Budgeted direct labor hours	3,000 hours	2,000 hours

Questions:

1. Using plant-wide Factory Overhead rate based on direct labor hours, how much is the Factory Overhead rate per unit?

2. Assume in the Assembly Department, machine hours are the basis in calculation the Factory overhead rate, what is the departmental Factory overhead rate per unit?

3. Assume in the Finishing Department, direct labor hours are the basis in calculation the Factory overhead rate, what is the departmental Factory overhead rate per unit?

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