The overhead rate for materials handling is $10 per part based on an estimated total cost of $900. Products X & Y have 320 and 280 parts respectively. What is the overhead allocated to X & Y?
A. Product X $3,200, Product Y $4,400
B. Product X $4,800, Product Y $4,400
C. Product X $4,800, Product Y $2,800
D. Product X $3,200, Product Y $2,800
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To calculate the overhead allocated to products X and Y, you need to multiply the number of parts for each product by the overhead rate for materials handling.
First, let's calculate the overhead allocated to product X:
Overhead allocated to product X = Number of parts for product X * Overhead rate for materials handling
Overhead allocated to product X = 320 parts * $10 per part
Overhead allocated to product X = $3,200
Now, let's calculate the overhead allocated to product Y:
Overhead allocated to product Y = Number of parts for product Y * Overhead rate for materials handling
Overhead allocated to product Y = 280 parts * $10 per part
Overhead allocated to product Y = $2,800
Therefore, the correct answer is D. Product X $3,200, Product Y $2,800.