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Multiple Production Department Factory Overhead Rate Method Handy Leather, Inc., produces three sizes of sports gloves: small, medium, and large. A glove pattern is first stenciled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the glove is cut and sewed together. Handy Leather uses the multiple production department factory overhead rate method of allocating factory overhead costs. Its factor overhead costs were budgeted as follows: Pattern Department overhead Cut and Sew Department overhead Total The direct labor estimated for each production department was as follows: Pattern Department Cut and Sew Department Total Direct labor hours are used to allocate the production department overhead to the products. The direct labor hours per unit for each product for each production department were obtained from the engineering records as follows: Production Departments Pattern Department Cut and Sew Department Direct labor hours per unit Pattern Department Cut and Sew Department Small glove Medium glove Large glove $ $ 2,700 direct labor hours 3,400 6,100 direct labor hours $ Small Glove Medium Glove Large Glove 0.05 0.08 0.13 If required, round all per unit answers to the nearest cent. $ $132,300 221,000 a. Determine the two production department factory overhead rates. $353,300 per unit b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. per unit per dih per dih per unit 0.06 0.10 0.16 0.07 0.12 0.19

Multiple Production Department Factory Overhead Rate Method Handy Leather, Inc., produces three sizes of sports gloves: small, medium, and large. A glove pattern is first stenciled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the glove is cut and sewed together. Handy Leather uses the multiple production department factory overhead rate method of allocating factory overhead costs. Its factor overhead costs were budgeted as follows: Pattern Department overhead Cut and Sew Department overhead Total The direct labor estimated for each production department was as follows: Pattern Department Cut and Sew Department Total Direct labor hours are used to allocate the production department overhead to the products. The direct labor hours per unit for each product for each production department were obtained from the engineering records as follows: Production Departments Pattern Department Cut and Sew Department Direct labor hours per unit Pattern Department Cut and Sew Department Small glove Medium glove Large glove $ $ 2,700 direct labor hours 3,400 6,100 direct labor hours $ Small Glove Medium Glove Large Glove 0.05 0.08 0.13 If required, round all per unit answers to the nearest cent. $ $132,300 221,000 a. Determine the two production department factory overhead rates. $353,300 per unit b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. per unit per dih per dih per unit 0.06 0.10 0.16 0.07 0.12 0.19

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 5E: Handy Leather, Inc., produces three sizes of sports gloves: small, medium, and large. A glove...
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Multiple Production Department Factory Overhead Rate Method Handy Leather, Inc., produces three sizes of sports gloves: small, medium, and large. A glove pattern is first stenciled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the glove is cut and sewed together. Handy Leather uses the multiple production department factory overhead rate method of allocating factory overhead costs. Its factor overhead costs were budgeted as follows: Pattern Department overhead Cut and Sew Department overhead Total The direct labor estimated for each production department was as follows: Pattern Department Cut and Sew Department Total Production Departments Pattern Department Cut and Sew Department Direct labor hours per unit Direct labor hours are used to allocate the production department overhead to the products. The direct labor hours per unit for each product for each production department were obtained from the engineering records as follows: Pattern Department Cut and Sew Department Small glove Medium glove Large glove $ $ 2,700 direct labor hours 3,400 6,100 direct labor hours If required, round all per unit answers to the nearest cent. a. Determine the two production department factory overhead rates. $ $132,300 221,000 $353,300 Small Glove Medium Glove Large Glove 0.07 0.12 0.19 $ $ 0.05 0.08 0.13 b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. per dih per dih per unit per unit per unit 0.06 0.10 0.16
Transcribed Image Text:Multiple Production Department Factory Overhead Rate Method Handy Leather, Inc., produces three sizes of sports gloves: small, medium, and large. A glove pattern is first stenciled onto leather in the Pattern Department. The stenciled patterns are then sent to the Cut and Sew Department, where the glove is cut and sewed together. Handy Leather uses the multiple production department factory overhead rate method of allocating factory overhead costs. Its factor overhead costs were budgeted as follows: Pattern Department overhead Cut and Sew Department overhead Total The direct labor estimated for each production department was as follows: Pattern Department Cut and Sew Department Total Production Departments Pattern Department Cut and Sew Department Direct labor hours per unit Direct labor hours are used to allocate the production department overhead to the products. The direct labor hours per unit for each product for each production department were obtained from the engineering records as follows: Pattern Department Cut and Sew Department Small glove Medium glove Large glove $ $ 2,700 direct labor hours 3,400 6,100 direct labor hours If required, round all per unit answers to the nearest cent. a. Determine the two production department factory overhead rates. $ $132,300 221,000 $353,300 Small Glove Medium Glove Large Glove 0.07 0.12 0.19 $ $ 0.05 0.08 0.13 b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. per dih per dih per unit per unit per unit 0.06 0.10 0.16
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