Plant vs. departmental OH ratesRed River Farm Machine makes a wide variety of products, all of which must be processed in the Cutting and Assembly departments. For the year, Red River budgeted total overhead of $993,000, of which $385,500 will be incurred in Cutting and the remainder will be incurred in Assembly. Budgeted direct labor and machine hours are as follows: Cutting Assembly Budgeted direct labor hours 27,000 3,000 Budgeted machine hours 2,100 65,800 Two products made by Red River are the RW22SKI and the SD45ROW. The following cost and production time information on these items has been gathered: RW22SKI SD45ROW Direct material $34.85 $19.57 Direct labor rate in Cutting $20.00 $20.00 Direct labor rate in Assembly $8.00 $8.00 Direct labor hours in Cutting 6.00 4.80 Direct labor hours in Assembly 0.03 0.05 Machine hours in Cutting 0.06 0.15 Machine hours in Assembly 5.90 9.30 a. What is the plantwide predetermined OH rate based on (1) direct labor hours and (2) machinehours for the upcoming year?Note: Round your answers to two decimal places (i.e. round $4.3555 to $4.36).(1) OH rate based on direct labor hours $Answer per DLH(2) OH rate based on machine hours $Answer per MHb. What are the departmental predetermined OH rates in Cutting and Assembly using the most appropriate base in each department?Note: Round your answers to two decimal places (i.e. round $4.3555 to $4.36).(1) OH rate in Cutting: $Answer per DLH(2) OH rate in Assembly: $Answer per MHc. What are the costs of products RW22SKI and SD45ROW using (1) a plantwide rate based on direct labor hours, (2) a plantwide rate based on machine hours, and (3) departmental rates calculated in (b)?Note: Round your answers to two decimal places (i.e. round $4.3555 to $4.36). RW22SKI SD45ROW (1) Total cost using plantwide rate based on DLHs Answer Answer (2) Total cost using plantwide rate based on MHs Answer Answer (3) Total cost using rates in (b) Answer Answer
Plant vs. departmental OH rates
Red River Farm Machine makes a wide variety of products, all of which must be processed in the Cutting and Assembly departments. For the year, Red River budgeted total overhead of $993,000, of which $385,500 will be incurred in Cutting and the remainder will be incurred in Assembly. Budgeted direct labor and machine hours are as follows:
| Cutting | Assembly | |
|---|---|---|
| Budgeted direct labor hours | 27,000 | 3,000 |
| Budgeted machine hours | 2,100 | 65,800 |
Two products made by Red River are the RW22SKI and the SD45ROW. The following cost and production time information on these items has been gathered:
| RW22SKI | SD45ROW | |
|---|---|---|
| Direct material | $34.85 | $19.57 |
| Direct labor rate in Cutting | $20.00 | $20.00 |
| Direct labor rate in Assembly | $8.00 | $8.00 |
| Direct labor hours in Cutting | 6.00 | 4.80 |
| Direct labor hours in Assembly | 0.03 | 0.05 |
| Machine hours in Cutting | 0.06 | 0.15 |
| Machine hours in Assembly | 5.90 | 9.30 |
a. What is the plantwide predetermined OH rate based on (1) direct labor hours and (2) machine
hours for the upcoming year?
Note: Round your answers to two decimal places (i.e. round $4.3555 to $4.36).
(1) OH rate based on direct labor hours $Answer
per DLH
(2) OH rate based on machine hours $Answer
per MH
b. What are the departmental predetermined OH rates in Cutting and Assembly using the most appropriate base in each department?
Note: Round your answers to two decimal places (i.e. round $4.3555 to $4.36).
(1) OH rate in Cutting: $Answer
per DLH
(2) OH rate in Assembly: $Answer
per MH
c. What are the costs of products RW22SKI and SD45ROW using (1) a plantwide rate based on direct labor hours, (2) a plantwide rate based on machine hours, and (3) departmental rates calculated in (b)?
Note: Round your answers to two decimal places (i.e. round $4.3555 to $4.36).
| RW22SKI | SD45ROW | |
|---|---|---|
| (1) Total cost using plantwide rate based on DLHs | Answer
|
Answer
|
| (2) Total cost using plantwide rate based on MHs | Answer
|
Answer
|
| (3) Total cost using rates in (b) | Answer
|
Answer
|
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