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Production Department Factory Overhead Kate 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 ar 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 allocatin factory overhead costs. Its factory 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 1,900 direct labor hours Cut and Sew Department 2,400 Total 4,300 direct labor hours $96,900 163,200 $260,100 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: Small Glove Medium Glove Production Departments Pattern Department. 0.04 Cut and Sew Department 0.07 Direct labor hours per unit 0.11 If required, round all per unit answers to the nearest cent. a. Determine the two production department factory overhead rates. Pattern Department per dlh per dlh Cut and Sew Department b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. Small glove Medium glove Large glove $ per unit per unit per unit 0.05 0.09 0.14 Large Glove 0.06 0.11 0.17

Production Department Factory Overhead Kate 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 ar 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 allocatin factory overhead costs. Its factory 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 1,900 direct labor hours Cut and Sew Department 2,400 Total 4,300 direct labor hours $96,900 163,200 $260,100 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: Small Glove Medium Glove Production Departments Pattern Department. 0.04 Cut and Sew Department 0.07 Direct labor hours per unit 0.11 If required, round all per unit answers to the nearest cent. a. Determine the two production department factory overhead rates. Pattern Department per dlh per dlh Cut and Sew Department b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. Small glove Medium glove Large glove $ per unit per unit per unit 0.05 0.09 0.14 Large Glove 0.06 0.11 0.17

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 factory 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 1,900 direct labor hours Cut and Sew Department 2,400 Total 4,300 direct labor hours 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 Small Glove Medium Glove Large Glove Pattern Department 0.06 Cut and Sew Department 0.11 Direct labor hours per unit If required, round all per unit answers to the nearest cent. a. Determine the two production department factory overhead rates. Pattern Department per dlh per dlh Cut and Sew Department $ b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. Small glove per unit Medium glove per unit Large glove 0.04 0.07 0.11 $96,900 163,200 $260,100 per unit 0.05 0.09 0.14 0.17
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 factory 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 1,900 direct labor hours Cut and Sew Department 2,400 Total 4,300 direct labor hours 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 Small Glove Medium Glove Large Glove Pattern Department 0.06 Cut and Sew Department 0.11 Direct labor hours per unit If required, round all per unit answers to the nearest cent. a. Determine the two production department factory overhead rates. Pattern Department per dlh per dlh Cut and Sew Department $ b. Use the two production department factory overhead rates to determine the factory overhead per unit for each product. Small glove per unit Medium glove per unit Large glove 0.04 0.07 0.11 $96,900 163,200 $260,100 per unit 0.05 0.09 0.14 0.17
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