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Question Content Area Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication and Assembly. Data for the products and departments are listed below. Product Number ofUnits Direct Labor Hoursper Unit Machine Hoursper Unit   Rings 1,100 3 9   Dings 2,210 4 9 All of the machine hours take place in the Fabrication Department, which has estimated total factory overhead of $82,800. All of the labor hours take place in the Assembly Department, which has estimated total factory overhead of $71,300. Aleutian Company uses the multiple production department factory overhead rate method. The Fabrication Department uses machine hours as an allocation base, and the Assembly Department uses direct labor hours. The Fabrication Department's factory overhead rate is a. $2.78 per machine hour b. $6.65 per direct labor hour c. $2.59 per direct labor hour d. $5.87 per machine hour

Question Content Area Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication and Assembly. Data for the products and departments are listed below. Product Number ofUnits Direct Labor Hoursper Unit Machine Hoursper Unit   Rings 1,100 3 9   Dings 2,210 4 9 All of the machine hours take place in the Fabrication Department, which has estimated total factory overhead of $82,800. All of the labor hours take place in the Assembly Department, which has estimated total factory overhead of $71,300. Aleutian Company uses the multiple production department factory overhead rate method. The Fabrication Department uses machine hours as an allocation base, and the Assembly Department uses direct labor hours. The Fabrication Department's factory overhead rate is a. $2.78 per machine hour b. $6.65 per direct labor hour c. $2.59 per direct labor hour d. $5.87 per machine hour

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 2PB: Multiple production department factory overhead rates The management of Spotted Cow Dairy Company,...
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  1. Question Content Area

    Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication and Assembly. Data for the products and departments are listed below.

    Product Number of
    Units    		 Direct Labor Hours
    per Unit    		 Machine Hours
    per Unit
      Rings 1,100 3 9
      Dings 2,210 4 9

    All of the machine hours take place in the Fabrication Department, which has estimated total factory overhead of $82,800. All of the labor hours take place in the Assembly Department, which has estimated total factory overhead of $71,300.

    Aleutian Company uses the multiple production department factory overhead rate method. The Fabrication Department uses machine hours as an allocation base, and the Assembly Department uses direct labor hours.

    The Fabrication Department's factory overhead rate is

    a. $2.78 per machine hour
    b. $6.65 per direct labor hour
    c. $2.59 per direct labor hour
    d. $5.87 per machine hour
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