Bobke Technologies Manufactures Three Types of Computers for a Well

question 53

Essay

Bobke Technologies manufactures three types of computers for a well known national brand.The three types are: laptops,desktops,and tablets.Currently,Bobke uses a single plant-wide overhead rate to allocate its $1,667,250 of annual manufacturing overhead.Of this amount,$562,000 is associated with laptops,$492,000 is associated with desktops,and $612,750 is associated with tablets.Bobke is currently using a total of 22,150 machine hours: 7,500 for laptops,8,200 for desktops,and 6,450 for tablets.Bobke uses machine hours to allocate overhead costs.
Required:
a.Calculate the plant-wide manufacturing overhead rate.
b.Calculate the departmental overhead rate for each of the three departments listed.
c.Which product line(s)have been overcosted by using the plant-wide manufacturing overhead rate? By how much per machine hour? Which product line(s)have been undercosted by using the plant-wide manufacturing overhead rate? By how much per machine hour?

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Definitions:

Defense Mechanism

Psychological strategies brought into play by individuals to protect themselves from unacceptable thoughts or feelings.

Rationalization

A defense mechanism in which controversial behaviors or feelings are justified and explained in a seemingly rational or logical manner to avoid the true explanation.

Projection

An ego defense mechanism whereby individuals attribute to other people characteristics or impulses they do not wish to acknowledge in themselves.

Defecating

The act of expelling feces from the body's large intestine through the anus.