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Rafner Manufacturing identified the following budgeted data in its two production departments.
| Assembly | Finishing | |
| Manufacturing overhead costs | $ 1,247,500 | $ 650,000 |
| Direct labor hours | 12,500 DLH | 20,500 DLH |
| Machine hours | 6,500 MH | 16,500 MH |
Required:
1. What is the company’s single plantwide overhead rate based on direct labor hours?
2. What is the company’s single plantwide overhead rate based on machine hours?
♦ Relevant knowledge
The departmental overhead cost is a common overhead cost, based on amount units that the cost driver the department consumes over an amount of time. It’s used to assign expenses to departments on a timely basis.
1 Answer