Asked by Özge SA?IR on May 30, 2024

verifed

Verified

If a table lamp requires 2 hours of fabrication and 1 hour of assembly, the amount of factory overhead that Kaumajet Factory will allocate to each unit of table lamp using the multiple production department factory overhead rate method with an allocation base of direct labor hours is

A) $6.33
B) $4.91
C) $5.00
D) $7.20

Multiple Production Department Factory Overhead Rate

A method to allocate factory overhead costs to multiple production departments based on specific measures such as labor hours or machine hours.

Fabrication Department

A specialized division within a company where raw materials are converted into components or products through various processes.

Assembly Department

A segment within a manufacturing facility where components are assembled into final products or where significant assembly work takes place.

  • Execute various approaches for assigning factory overhead, utilizing single plantwide rate and several department rates.
verifed

Verified Answer

MP
morgan pelleyJun 06, 2024
Final Answer :
D
Explanation :
The overhead rate for the Fabrication Department is calculated as $550,000 / 500,000 hours = $1.10 per hour. The overhead rate for the Assembly Department is calculated as $400,000 / 80,000 hours = $5.00 per hour. For each table lamp, the overhead cost is (2 hours * $1.10) + (1 hour * $5.00) = $2.20 + $5.00 = $7.20.