Question: Cabigas Company manufactures two (2) products, Product E and Product F. The firm estimated it would incur $167,140 in manufacturing overhead costs during the current period. Overhead currently is applied to the products on the basis of direct labor hours. Information concerning the current period's operations appear below:
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Product E
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Product F
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Estimated volume
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2,000 units
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2,700 units
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Direct labor hours per unit
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2.00 hours
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0.80 hour
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Total hours
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4000 hour
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2160 hours
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Direct materials cost per unit
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$21.50
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$24.10
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Direct labor cost per unit
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$24.00
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$9.60
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Required:
Calculate the predetermined overhead rate under the current method, & estimate the unit product cost of each product for the current year.