Accounting for Decision Making and Control 8th Edition by Jerold Zimmerman

تمرين 30

Dead Eye Putters
Dead Eye Putters manufactures golf putters in three models: P450, Q550, and R650. Manufacturing overhead is assigned to each putter model using a predetermined overhead rate and the direct labor hours actually used in manufacturing each putter model. The firm calculates the overhead rate before the year begins using a flexible budget. Budgeted volume is measured using direct labor hours.
The following data summarize the budgeted and actual production for the fiscal year:
After the fiscal year ends, Dead Eye Putters reports $884,713 underabsorbed overhead and actual overhead incurred of $25,875,026. Variable overhead was budgeted to be $3.50 per direct labor hour.
Required:
a. Compute Dead Eye Putter's manufacturing overhead rate used during the year.
b. What budgeted fixed overhead did Dead Eye Putters use in computing its manufacturing overhead rate for the year?