Seco, Inc., produces two types of clothes dryers: deluxe and regular. Seco uses a plantwide rate based on direct labor hours to assign its overhead costs. The company has the following estimated and actual data for the coming year:
Estimated overhead $
Expected activity
Actual activity direct labor hours:
Deluxe dryer
Regular dryer
Units produced:
Deluxe dryer
Regular dryer
Required:
Calculate the predetermined plantwide overhead rate, using direct labor hours.
$fill in the blank
per hour
Calculate the applied overhead for each product, using direct labor hours.
Applied overhead
Deluxe $fill in the blank
Regular $fill in the blank
Calculate the overhead cost per unit for each product. If required, round your answers to the nearest cent.
Overhead Cost
Deluxe $fill in the blank
per unit
Regular $fill in the blank
per unit
What if the deluxe product used hours to produce units instead of hours total expected hours remain the same Calculate the effect on the profitability of this product line if all units are sold.
Profits would
by $fill in the blank
