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single plantwide factory overhead rate

Single Plantwide Factory Overhead Rate

Salty 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

$11,233

Indirect labor

27,839

Factory electricity

3,175

Indirect materials

6,593

Selling expenses

15,629

Administrative expenses

8,791

Total costs

$73,260

Factory 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

5,700

0.15

Potato chips

1,800

0.12

Pretzels

1,500

0.10

Total

9,000

If required, round all per-case answers to the nearest cent.

a. Determine the single plantwide factory overhead rate.
$ per processing hour

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.

Total
Factory Overhead

Per-Case
Factory Overhead

Tortilla chips

$

$

Potato chips

Pretzels

Total

$

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