Misner Office Products Produces Three Models of Commercial Shelving,the Basic,the

Essay

Misner Office Products produces three models of commercial shelving,the Basic,the Advanced and the Superior.Data on operations and costs for the month are:
Required:
Compute the predetermined overhead rate,assuming Misner Office Products uses:
(a)Direct labor hours to allocate overhead costs.(b)Direct labor costs to allocate overhead costs.(c)Machine hours to allocate overhead costs.(d)Compute the unit cost for each model using direct labor costs to allocate overhead. $$\begin{array} { | l | r | r | r | r | } \hline & \text { Basic } & \text { Aovanced } & \text { Superior } & \text { Total } \\\hline \text { Machine hours } & 8,000 & 6,000 & 4,000 & 18,000 \\\hline \text { Direct labor hours } & 6,000 & 6,000 & 4,000 & 16,000 \\\hline \text { Units produced } & 1,000 & 500 & 250 & 1,750 \\\hline \begin{array} { l } \text { Direct material } \\\text { costs }\end{array} & \$ 20,000 & \$ 12,500 & \$ 7,500 & \$ 40,000 \\\hline \text { Direct labor costs } & 129,000 & 100,000 & 71,000 & 300,000 \\\hline \text { Manutacturing } & & & & 540,800 \\\text { overhead costs } & & & & \\\hline \text { Total costs } & & & &\$ 880,800 \\\hline\end{array}$$