Cost Accounting Assignment: Determine the factory overhead rates. Round money to
ID: 2461777 • Letter: C
Question
Cost Accounting Assignment:
Determine the factory overhead rates. Round money to the nearest cent and rates to the nearest percent. Label your answers.
The XYZ Co. estimates its factory overhead for the year to be $58,000. They further estimate they will produce 38,000 units at a material cost of $48,000. Production will require 20,000 direct labor hours at an estimated cost of $100,000. Machines will work 1500 hours.
Find the following predetermined rates:
material cost
per unit cost
machine hour cost
direct labor cost
direct labor hour cost
Explanation / Answer
Material cost = 48000
Units produced = 38000
Material cost per unit = 48000/38000 =1.26 per unit
Machine hour cost = total machine hours =
Direct labor cost = 100000 = direct labor hours = 20000
direct labour cost per hour = 100000/20000 = 5 per hour
Machine hour cost = factory overhead = 58000
Machine hour in total = 1500 = 58000/1500 = 38.67 per machine hour