Rain Maker Company Uses a Plantwide Overhead Rate with Direct

question 29

Multiple Choice

Rain Maker Company uses a plantwide overhead rate with direct labor hours as the allocation base.Next year, 350,000 units are expected to be produced taking .80 direct-labor hours each.How much overhead will be assigned to each unit produced given the following estimated amounts? $$\begin{array} { l c c } \text { Estimated: } & \text { Department 1 } & \text { Departnent } 2 \\\text { Marufacturing overhead costs } & \$ 2,730,000 & \$ 910,000 \\\text { Direct labor hours } & 168,000 D L H & 112,000 \mathrm { DLH } \\\text { Machine hours } & 30,000 \mathrm { MH } & 7,000 \mathrm { MH }\end{array}$$

• A)$13.00 per unit
• B)$10.40 per unit
• C)$16.25 per unit
• D)$6.50 per unit
• E)$8.13 per unit

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Definitions:

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