Rounders Company used the following information when determining the appropriate overhead rates to use in its two production departments:
Two of the products in the product line were as follows:
Required:

a.
Assume that Rounders applies overhead using a plantwide rate based on direct labour hours. Determine the unit cost of Products 1 and 2.
b.
Assume that Rounders uses direct labour hours to apply overhead in the Fabrication Department and machine hours to apply overhead in the Assembly Department. Determine the unit cost of Products 1 and 2.

Question

Rounders Company used the following information when determining the appropriate overhead rates to use in its two production departments:
Two of the products in the product line were as follows:
  Required:
  
a.
Assume that Rounders applies overhead using a plantwide rate based on direct labour hours. Determine the unit cost of Products 1 and 2.
b.
Assume that Rounders uses direct labour hours to apply overhead in the Fabrication Department and machine hours to apply overhead in the Assembly Department. Determine the unit cost of Products 1 and 2.

Quizplus · Accepted Answer

The Answer of Rounders Company used the following information when determining the appropriate overhead rates to use in its two production departments:
Two of the products in the product line were as follows:
  Required:
  
a.
Assume that Rounders applies overhead using a plantwide rate based on direct labour hours. Determine the unit cost of Products 1 and 2.
b.
Assume that Rounders uses direct labour hours to apply overhead in the Fabrication Department and machine hours to apply overhead in the Assembly Department. Determine the unit cost of Products 1 and 2.

Rounders Company Used the Following Information When Determining the Appropriate