Laval produces lamps and home lighting fixtures. Its most popular product is a b
ID: 2557867 • Letter: L
Question
Laval produces lamps and home lighting fixtures. Its most popular product is a brushed aluminum desk lamp. This lamp is made from components shaped in the fabricating department and assembled in the assembly department. Information related to the 35,000 desk lamps produced annually follows Direct materials Direct labor $280,000 Fabricating department (7,000 DLHx $20 per DLH) Assembly department (16,000 DLH x $29 per DLH) $140,000 $464,000 Machine hours Fabricating department Assembly department 15,040 MH 21,000 MH Expected overhead cost and related data for the two production departments follow. Direct labor hours Machine hours Overhead cost Fabricating Assembly 75,000 DLH 125,000 DLH 80,000 MH 62,500 MH $200,000 300,000 Required 1. Determine the plantwide overhead rate for Laval using direct labor hours as a base 2. Determine the total manufacturing cost per unit for the aluminum desk lamp using the plantwide overhead rate 3. Compute departmental overhead rates based on machine hours in the fabricating department and direct labor hours in the assembly department. 4. Use departmental overhead rates from requirement 3 to determine the total manufacturing cost per unit for the aluminum desk amps Complete this question by entering your answers in the tabs below Required 1 Required 2Required 3 Required 4 Determine the plantwide overhead rate for Laval using direct labor hours as a base Required 1 Required 2 >Explanation / Answer
Solution 1:
Total direct labor hours for both departments = 75000 + 125000 = 200000 DLH
Total overhead cost = $300,000 + $200,000 = $500,000
Plantwide overhead rate on the basis of direct labor hours = $500,000 / 200000 = $2.50 per DLH
Solution 2:
Solution 3:
Solution 4:
Computation of manufacturing cost per unit - plantwide overhead rate - Laval Particulars Amount Total Manufacturing cost: Direct material $280,000.00 Direct Labor: Fabricating department $140,000.00 Assembly department $464,000.00 Applied overhead (23000*$2.50) $57,500.00 Total manufacturing cost $941,500.00 Total desk lamp produced $35,000.00 Manufacturing cost per unit $26.90Related Questions
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