Freeze Frame, Inc Freeze Frame's Total Expected Overhead Costs and Related Overhead Data

question 20

Essay

Freeze Frame, Inc.produces cameras that require three processes, A, B, and C, to complete.Digital camera model #789 is the best-selling of all the many types of cameras produced.Information related to the 550,000 units of digital camera model #789 produced annually is shown below.
$$\begin{array} { | l | r | } \hline \text { Direct materials } & \$ 450,000 \\\hline \text { Direct labor } & \\\hline \text { Department A } ( 7,000 \text { DLL } \times \$ 21 \text { per DLH } ) & \$ 147,000 \\\hline \text { Department B } ( 25,000 \text { DLH } \times \$ 19 \text { per DLH) } & \$ 475,000 \\\hline \text { Department C } ( 10,000 \text { DLHH } \times \$ 26 \text { per DLH) } & \$ 260,000 \\\hline \text { Machine Hours } & \\\hline \text { Department } A & 42,000 \mathrm { MH } \\\hline \text { Department B } & 23,000 \mathrm { MH } \\\hline \text { Department C } & 38,000 \mathrm { MH } \\\hline\end{array}$$ Freeze Frame's total expected overhead costs and related overhead data are shown below:
$$\begin{array} { | l | r | r | r | } \hline & \text { Department A } & { \begin{array} { l } \text { Departrnent } \\\text { B }\end{array} } & { \begin{array} { l } \text { Cepartrnent } \\\text { C }\end{array} } \\\hline \text { Direct labor hours } & 90,000 \mathrm { DLH } & 75,000 \mathrm { DLH } & 42,000 \mathrm { DLH } \\\hline \text { Machine hours } & 67,500 \mathrm { MH } & 135,000 \mathrm { MH } & 53,200 \mathrm { MH } \\\hline \begin{array} { l } \text { Manufacturing overhead } \\\text { costs }\end{array} & \$ 540,000 & \$ 675,000 & \$ 399,000 \\\hline\end{array}$$ a.Compute a departmental overhead rate for department A based on direct labor hours.
b.How much overhead is associated with model 789 from department A?
c.Compute a departmental overhead rate for department B based on direct labor hours.
d.How much overhead is associated with model 789 from department B?
e.Compute a departmental overhead rate for department C based on direct labor hours.
f.How much overhead is associated with model 789 from department C?
g What is the per unit cost of the 550,000 units of model 789?

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Definitions:

Frequency Polygon

Line graph that uses data points to represent the frequency of each value of a variable.

Skewed Distribution

A distribution where the tails on one side of the mean are longer or fatter, indicating lack of symmetry.

Frequency Distribution

A representation, often in the form of a table or graph, of how the values in a data set are distributed across categories or intervals.

Infinite Number

A quantity that has no end or limit, often used in mathematics to describe a value that grows without bounds.