The Kaumajet Factory Produces Two Products - Table Lamps and Desk

question 79

Multiple Choice

The Kaumajet Factory produces two products - table lamps and desk lamps. It has two separate departments - finishing and production. The overhead budget for the finishing department is $550,000, using 500,000 direct labor hours. The overhead budget for the production department is $400,000 using 80,000 direct labor hours. If the budget estimates that a table lamp will require 2 hours of finishing and 1 hours of production, how much factory overhead will be allocated to each unit of table lamp using the multiple production department factory overhead rate method with an allocation base of direct labor hours?

• A) $6.33
• B) $4.91
• C) $5.00
• D) $7.20