3310solmod17

3310solmod17 - Module 17 Answers 8-20. (30 min.) Plantwide...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Module 17 Answers 8-20. (30 min.) Plantwide versus Department Allocation: Munoz Sporting Equipment Baseball Bats Tennis rackets a. Revenue. ...................... $2,400,000 $1,600,000 Direct Labor. ................. 400,000 200,000 Direct Materials . ........... 1,100,000 550,000 Overhead. ..................... 800,000 a 400,000 b Profit. ............................ $100,000 $ 450,000 a $800,000 = $400,000 direct labor x 200%. b $400,000 = $200,000 direct labor x 200%. b. Maria was wrong; Baseball bats were more profitable. Baseball Bats Tennis rackets Revenue. ...................... $2,400,000 $1,600,000 Direct Labor. ................. 400,000 200,000 Direct Materials . ........... 1,100,000 550,000 Overhead. ..................... 600,000 a 600,000 b Profit. ............................ $300,000 $ 250,000 a $600,000 = $400,000 direct labor x 150%. b $600,000 = $200,000 direct labor x 300%. c. The plantwide allocation method allocates overhead at 200% of direct labor for both types of equipment. While this is the simplest method, it is usually not very accurate. It assumes that overhead in both departments has the same rate. When overhead costs are broken down into department cost pools, we see
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 5

3310solmod17 - Module 17 Answers 8-20. (30 min.) Plantwide...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online