13 Dec Single plantwide factory overhead rateSalty Sensat
Single plantwide factory overhead rateSalty Sensations Snacks Company manufactures three types of snack foods: tortilla chips, potato chips, and pretzels. The company has budgeted the following costs for the upcoming period:Factory depreciation $ 31,360 Indirect labor 78,400 Factory electricity 7,840 Indirect materials 35,400 Selling expenses 25,000 Administrative expenses 18,000 Total costs $196,000Factory overhead is allocated to the three products on the basis of processing hours. The products had the following production budget and processing hours per case:Budgeted Volume (Cases) Processing Hours per Case Tortilla chips 4,000 0.20 Potato chips 5,000 0.15 Pretzels 2,500 0.40Total 11,500a. Determine the single plantwide factory overhead rate.b. Use the factory overhead rate in (a) to determine the amount of total and per-case factory overhead allocated to each of the three products under generally accepted accounting principles.