Matt’s Music Inc. makes three musical instruments: trumpets, tubas, and trombone
ID: 2471321 • Letter: M
Question
Matt’s Music Inc. makes three musical instruments: trumpets, tubas, and trombones. The budgeted factory overhead cost is $189,332. Factory overhead is allocated to the three products on the basis of direct labor hours. The products have the following budgeted production volume and direct labor hours per unit: Budgeted Production Direct Labor Hours Volume (in units) per Unit Trumpets 2,000 0.75 Tubas 700 1.70 Trombones 1,290 1.25
A. Determine the single plantwide factory overhead rate.
per direct labor hour
B. Use the factory overhead rate in (A) to determine the amount of total and per-unit factory overhead allocated to each of the three products. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.
Total
Amount Descriptions Assembly Fabrication Trombones Trumpets TubasTotal
Explanation / Answer
CALCULATION OF SINGLE FACTORY OVERHEAD RATE :
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VOLUME (UNITS) LABOUR HOURS (PER UNIT) TOTAL HOURS
TRUMPETS 2,000 0.75 15,00.00
TUBAS 700 1.70 1,190.00
TROMBONES 1,290 1.25 1,612.50
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FOH RATE LABOUR HRS (PER UNIT) PRODUCT WISE OH RATE($) TOTAL OH
TRUMPETS $44 0.75 $33.0 = (44 x 0.75) 1,500 X 33 = $49,500
TUBAS 44 1.70 $74.8 = (44 X 1.70) 1,190 X 74.8 =89,012
TROMBONES 44 1.25 $ 55.0 = (44 X 1.25) 1,612.5 X 55 =88,687.5