Problem - The total factory overhead for Big Light Company is budgeted for the year at $1,659,000. Big Light manufactures two different products - night lights and desk lamps. Night lights is budgeted for 21,800 units. Each night light requires two hour of direct labor. Desk lamps is budgeted for 8,800 units. Each desk lamp requires three hours of direct labor.
a. Determine the total number of budgeted direct labor hours for year.
b. Determine the single plantwide factory overhead rate using direct labor hours as the allocation base.
c. Determine the factory overhead allocated per unit for each product using the single plantwide factory overhead rate calculated in (b).