Borsetta,Inc.manufactures two kinds of bags-totes and satchels.The company allocates manufacturing overhead using a single plantwide rate with direct labor cost as the allocation base.Estimated overhead costs for the year are $25,000.Additional estimated information is given below. $$\begin{array} { | l | r | r | }
\hline & \text { Totes } & \text { Satchels } \
\hline \text { Direct materials cost per unit } & \$ 33 & \$ 44 \
\hline \text { Direct labor cost per unit } & \$ 54 & \$ 62 \
\hline \text { Number of units } & 540 & 370 \
\hline
\end{array}$$ Calculate the amount of overhead to be allocated to Satchels,if the actual units produced and direct labor costs equal the estimated amounts.(Round any percentages to two decimal places and your final answer to the nearest dollar.)
A)$463
B)$13,991
C)$11,007
D)$22,940

Question

Borsetta,Inc.manufactures two kinds of bags-totes and satchels.The company allocates manufacturing overhead using a single plantwide rate with direct labor cost as the allocation base.Estimated overhead costs for the year are $25,000.Additional estimated information is given below. $$\begin{array} { | l | r | r | } 
\hline & \text { Totes } & \text { Satchels } \
\hline \text { Direct materials cost per unit } & \$ 33 & \$ 44 \
\hline \text { Direct labor cost per unit } & \$ 54 & \$ 62 \
\hline \text { Number of units } & 540 & 370 \
\hline
\end{array}$$ Calculate the amount of overhead to be allocated to Satchels,if the actual units produced and direct labor costs equal the estimated amounts.(Round any percentages to two decimal places and your final answer to the nearest dollar.)
A)$463
B)$13,991
C)$11,007
D)$22,940

Quizplus · Accepted Answer

The total direct labor cost is calculated as (540 units * $54) + (370 units * $62) = $29,160 + $22,940 = $52,100. The overhead rate is $25,000 / $52,100 = 0.47985. The overhead allocated to Satchels is 370 units * $62 * 0.47985 = $11,007.

Borsetta,Inc Calculate the Amount of Overhead to Be Allocated to Satchels,if