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TB MC Qu. 17-112 (Algo) Crinkle Cut Clothes Company manufactures...

Crinkle Cut Clothes Company manufactures two products CC1 and CC2. Current direct material and direct labor costs are detailed below. Next year the company wishes to use a plantwide overhead rate with direct labor hours as its allocation base. Next year's overhead is budgeted to be $644,940. The direct labor and direct materials costs are budgeted to be consistent with the current year. Direct labor costs $20 per hour and the company expects to manufacture 30,000 units of CC1 and 99,000 units of CC2 next year.

	Direct Material per Unit	Direct Labor Dollars per Unit
CC1	$ 37.90	$ 18.20
CC2	$ 26.00	$ 16.20

Compute the plantwide overhead rate for next year.

Multiple Choice

• $20.00 per DLH.

• $34.40 per DLH.

• $1.90 per DLH.

• $6.00 per DLH.

• $0.78 per DLH.

TB MC Qu. 17-116 (Algo) Aztec Industries produces bread...

Aztec Industries produces bread which goes through two operations, Mixing and Baking, before it is ready to be packaged. Next year's expected costs and activities are shown below.

	Mixing		Baking
Direct labor hours	416,000	DLH	96,000	DLH
Machine hours	816,000	MH	816,000	MH
Overhead costs	$ 665,600		$ 416,000

Compute Aztec's departmental overhead rate for the Baking department based on machine hours.

Multiple Choice

• $1.60 per MH

• $4.33 per MH

• $0.82 per MH

• $0.51 per MH

• $2.11 per MH

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