Question

Single plantwide factory overhead rate Instructions Amount Descriptions Overhead Instructions Salty Sensations Snacks Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period: 1 Factory depreciation Indirect labor $29,168.00 72,920.00 7,292.00 26,220.00 Factory electricity Indirect materials Selling expenses 27,000.00 19,700.00 Administrative expenses Total costs $182,300.00 Factory overhead is allocated to the three products on the basis of processing hours. The products had the following production budget and processing hours per case: Budgeted Volume (Cases) Processing Hours per Case Tortilla chips 3.900 0.18 Potato chips 5.100 0.12 Pretzels 2,200 0.43 Total 11.200 Required: a. Determine the single plantwide factory overhead rate.* b. Use the factory overhead rate in (a) to determine the amount of total and per-case factory overhead allocated to each of the three products under generally accepted accounting principles. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.* * If required, round your answers to the nearest cent.

Answer 1

		Budgeted Volume (Cases)	Processing Hours per Case	Total processing Per Case
	Tortilla chips	3,900	0.18	702
	Potato chips	5,100	0.12	612
	Pretzels	2,200	0.43	946
	Total	11,200		2,260
	Ques 1
	factory overhead rate = total overhead cost / total processing hours
	factory overhead rate = 135600/2260
	factory overhead rate =	$           60.00
	overhead costs
	Factory depreciation	$29,168.00
	Indirect labor	$72,920.00
	Factory electricity	$7,292.00
	Indirect materials	$26,220.00
	total overhead costs	$135,600.00
	Ques 2
		processing per case	rate	total factory overhead	volume	per case factory overhead
	Tortilla chips	702	$           60	$             42,120	3,900	$    10.80
	Potato chips	612	$           60	$             36,720	5,100	$       7.20
	Pretzels	946	$           60	$             56,760	2,200	$    25.80
	Total	2,260		$           135,600