Question - Single Plant-wide Factory Overhead Rate
Armstrong Band Instruments Inc. makes three musical instruments: trumpets, tubas, and trombones. The budgeted factory overhead cost is $145,500. Factory overhead is allocated to the three products on the basis of direct labor hours. The products have the following budgeted production volume and direct labor hours per unit:
a. Determine the single plantwide factory overhead rate.
b. Use the factory overhead rate in (a) to determine the amount of total and per-unit factory overhead allocated to each of the three products.