Question

Manufacturing overhead is applied to the product based on machine hours used in each department under the rate of $20 per machine hour. The total machine hours are $60,000 of which $25,000 are related to the Mixing Department and the remaining are related to the Baking Department.

Answer 1

The manufacturing overhead used to the mixing department is = $ 700,000

Step-by-step explanation:

Solution

For the information in the question stated the manufacturing overhead is used to each department based on the machine hours under a rate per machine hour.

So, the manufacturing overhead put into a department shall be equal to as

= The Machine hours used by the department * Manufacturing overhead rate per machine hour

Now,

The Calculation of manufacturing overhead applied to the baking department is given as:

From the information in the question stated we have ,

The hours used by the machine for the baking department = 25,000 machine hours ,

The Manufacturing rate overhead per machine hour = $ 20

Hence,

The manufacturing overhead applied to the baking department is defined as

= The Machine hours used by the baking department * Manufacturing overhead rate per machine hour

Which is,

= 25,000 * $ 20 = $ 500,000

Thus,

The manufacturing overhead applied to the baking department is defined as = $ 500,000

The Calculation of manufacturing overhead applied to the Mixing department is based on the information stated in the question thus we have:

The Machine hours used by the Mixing department = ( 60,000 - 25,000 ) = 35,000 machine hours ,

The Manufacturing rate of overhead per machine hour = $ 20

Now,

The manufacturing overhead applied to the Mixing department is

= The Machine hours used by the Mixing department * Manufacturing rate overhead per machine hour

= 35,000 * $ 20

= $ 700,000

Therefore,The manufacturing overhead used to the mixing department is = $ 700,000