Overhead assigned to flacca using a single overhead rate, Financial Management

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Overhead assigned to flacca using a single overhead rate

Austin Company manufactures 2 products, Flacca and Gordo. Overhead costs are comprised of machine set-ups $1,600,000; machining $3,600,000; and inspecting $1,200,000. Recent data are shown below:

Flacca Gordo

Direct labor hours 15,000 25,000

Machine setups 600 400

Machine hours 24,000 26,000

Inspections 800 700

Overhead assigned to Flacca using a single overhead rate based on direct labor hours and using ABC, respectively, would be:

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Financial Management: Overhead assigned to flacca using a single overhead rate

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