M7-28c - P7-28 (cont.) b. _________Cost pools_______...

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Unformatted text preview: P7-28 (cont.) b. _________Cost pools_______ departments 1 Common costs Producing 2 3 4 $6,400 P1 P2 $3,000 P3 $4,800 $12,000 Allocation of pool #1: (12,000) $12,000 (10/30) $4,000 $12,000 (15/30) $6,000 $12,000 (5/30) $2,000Allocation of pool #2: (6,400) $6,400 (2,000/10,000) 1,280 $6,400 (5,000/10,000) 3,200 $6,400 (3,000/10,000) 1,920Allocation of pool #3: (3,000) $3,000 (20/75) 800 $3,000 (45/75) 1,800 $3,000 (10/75) 400Allocation of pool #4: (4,800) $4,800 (4,800/16,000) 1,440 $4,800 (8,000/16,000) 2,400 $4,800 (3,200/16,000) _____ _____ _____ _____ _____ ______ 960Total $ 0 $ 0 $ 0 $ 0 $7,520 $13,400 $5,280 c. Based on direct labor hours: Total overhead costs $26,200 Total direct labor hours (1,600 + 4,000 + 750) ÷6,350 Cost per direct labor hour $ 4.126 Allocated to department P1: $4.126 × 1,600 = Allocated to department P2: $4.126 × 4,000 = $6,602 16,504 Allocated to department P3: $4.126 × 750 $26,200 = 3,094 ...
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