Smythe Co. makes furniture. The following data are taken from its production pla

Question

Smythe Co. makes furniture. The following data are taken from its production plans for the year. $5, 600,000 Direct labor costa Hazardous waste disposal costs 630,000 Chairs Tables Expected production Direct labor hours required 262, 000 DLH Hazardous waste disposed 211,000 units 10,000 units 15, 800 DLH 600 pounds 600 pounds Required: 1. Determine the hazardous waste disposal cost per unit for chairs and for tables if costs are assigned using a e plantwide overhead rate based on direct labor hours Units OH Cost pe Produced Product ActivityOH S per direct labor hour Total Overhead Cost Driver unit Chairs Tables 0.00 2. Determine hazardous waste disposal costs per unit for chairs and for tables if costs are assigned based on the number of pounds disposed of.

Explanation / Answer

Overhead allocation :

3) Assignment based on the number of pounds

1. Determine hazardous waste disposal costs per unit for chairs and for tables if costs are assigned using single plantwide rate on direct labour hous Single plant wide rate 630000 277800 2.26 per labour hour Product Activity driver OH $ per labour hour Total overhead cost Units produced Oh cost per unit Chairs 262000 2.26 594168 211000 2.82 Tables 15800 2.26 35832 10000 3.58 1. Determine hazardous waste disposal costs per unit for chairs and for tables if costs are assigned using single plantwide rate on pounds used Single plant wide rate 630000 1200 525 per pound Product Activity driver OH per pound Total overhead cost Units produced Oh cost per unit Chairs 600 525 315000 211000 1.49 Tables 600 525 315000 10000 31.50

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