How much overhead is allocated to the basic model

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Reference no: EM133922347

Problem

Lake Forest Corporation has sales of $4,953,339; income tax of $490,512; the selling, general and administrative expenses of $201,910; depreciation of $317,765; cost of goods sold of $2,449,150; and interest expense of $190,017. Calculate the amount of the firm's after-tax cash flow from operations?

Winslow makes handheld calculators in two models basic and professional and wants to refine its costing system by allocating overhead using departmental rates. The estimated $ 624,000 of manufacturing overhead has been divided into two cost pools: Assembly Department and Packaging Department. The following data have beencompiled:

	Assembly Department	Packaging Department	Total
Overhead costs	$460,000	$164,000	$624,000
Machine hours:
Basic Model	184,000 MHr	86,000 MHr	270,000 MHr
Professional Model	103,500 MHr	146,500 MHr	250,000 MHr
Total	287,500 MHr	232,500 MHr	520,000 MHr
Direct labor hours:
Basic Model	32,000 DLHr	45,000 DLHr	77,000 DLHr
Professional Model	335,000 DLHr	365,000 DLHr	700,000 DLHr
Total	367,000 DLHr	410,000 DLHr	777,000 DLHr

Compute the predetermined overhead allocation rates using machine hours as the allocation base for the Assembly Department and direct labor hours for the Packaging Department. Get the instant assignment help. How much overhead is allocated to the basic model? To the professional model? Round allocation rates to two decimal places and allocated costs to whole dollars.

Compute the total overhead allocated to the basic model, and then compute the total overhead allocated to the professional model.

Reference no: EM133922347

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