D
Dallas Company produces spas. The overhead is allocated using a plant-wide rate based on direct labor hours. You have
the following budgeted and actual indirect cost information for the year.
Budget
Actual
Quantity produced 16,000
15,450
Direct labor hours 104,000
108,500
Total indirect manufacturing overhead $1,300,000 $1,421,500
1. Determine the plant-wide overhead allocation rate using actual costing.
2. Dallas recently received two orders with the following details.
Order K1
Order T28
Quantity 200
120
Direct material $ $82,000
$54,000
Direct labor $ $56,000
$40,000
Direct labor hours 1,120
800
Determine the expected total unit costs per spa in each order using the allocation rate you determined in a. above for
overhead using actual costing.
3. Prepare the entry to record the allocation of manufacturing overhead for order K1 using actual costing.
