Multiple Production Department Factory Overhead Rate Method Four Finger Appliance Company manufactures small kitchen appliances. The product line consists of blenders and toaster ovens. Four Finger Appliance presently uses the multiple production department factory overhead rate method. The factory overhead is as follows: Assembly Department $78,000 Test and Pack Department 54,000 Total $132,000 The direct labor information for the production of 3,700 units of each product is as follows: Assembly Department Test and Pack Department Blender 500 dlh 1,500 dlh Toaster oven 1,500 500 Total 2,000 dlh 2,000 dlh Four Finger Appliance used direct labor hours to allocate production department factory overhead to products. If required, round all per unit answers to the nearest cent. a. Determine the two production department factory overhead rates. Assembly Department $ per direct labor hour Test and Pack Department $ per direct labor hour b. Determine the total factory overhead and the factory overhead per unit allocated to each product. Product Total Factory Overhead Factory Overhead Per Unit Blender $ $ Toaster Oven $ $

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 14E

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Multiple Production Department Factory Overhead Rate Method

Four Finger Appliance Company manufactures small kitchen appliances. The product line consists of blenders and toaster ovens. Four Finger Appliance presently uses the multiple production department factory overhead rate method. The factory overhead is as follows:

Assembly Department	$78,000
Test and Pack Department	54,000
	Total	$132,000

The direct labor information for the production of 3,700 units of each product is as follows:

	Assembly Department	Test and Pack Department
Blender			500	dlh	1,500	dlh
Toaster oven			1,500		500
Total			2,000	dlh	2,000	dlh

Four Finger Appliance used direct labor hours to allocate production department factory overhead to products.

If required, round all per unit answers to the nearest cent.

a. Determine the two production department factory overhead rates.

Assembly Department	$ per direct labor hour
Test and Pack Department	$ per direct labor hour

b. Determine the total factory overhead and the factory overhead per unit allocated to each product.

Product	Total Factory Overhead	Factory Overhead Per Unit
Blender	$	$
Toaster Oven	$	$

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