Problem - Multiple production department overhead rates
The total factory overhead for Ospina Company is budgeted for the year at $1,704,000 and divided into two departments: Fabrication, $1,344,000 and Assembly, $360,000. Morris manufactures two office furniture products: credenzas and desks. Each credenza requires four direct labor hours in Fabrication and two direct labor hours in Assembly. Each desk requires three direct labor hours in Fabrication and two direct labor hours in Assembly. Each product is budgeted for 8,000 units of production for the year.
If required, round all per unit answers to nearest whole cent.
Determine the departmental factory overhead rates for both departments.