Single Plantwide Factory Overhead Rate
Spotted Cow Dairy Company manufactures three products—whole milk, skim milk, and cream—in two production departments, Blending and Packing. The factory overhead for Spotted Cow Dairy is $184,800.
The three products consume both machine hours and direct labor hours in the two production departments as follows:
Direct Labor HoursMachine HoursBlending Department Whole milk190 590 Skim milk210 540 Cream170 210 570 1,340 Packing Department Whole milk250 330 Skim milk390 400 Cream110 130 750 860 Total1,320 2,200
1. Determine the single plantwide factory overhead rate, using each of the following allocation bases: (a) direct labor hours and (b) machine hours. If required, round all amounts to the nearest dollar.
a. Direct labor overhead rate$ per direct labor hourb. Machine hour overhead rate$ per machine hour
2. Determine the product factory overhead costs, using (a) the direct labor hour plantwide factory overhead rate and (b) the machine hour plantwide factory overhead rate.
Whole MilkSkim MilkCreamDirect labor hours$$$Machine hours$$$