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please! help! Single Plantwide and Multiple Production Department Factory Overhead Rate Methods and Product Cent Distortion

Edipso Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential motor, through two production departments, Assembly and Testing. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering wing the multiple production department factory overhead rate method. The following factory overhead was budgeted for Edline:

Sinple. Plantwide and Multople Production Department Factory Overhead Rate Methods and Prodoct Cost Distortion Eclipse Motor Company manufactures two types of specielty electric motors, a commercial motor and a residential motor, through two production departments, Assembly and Testing. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering using the multiple production department factory overhead rate method. The following factocy averhead was budgeted for Edipse: Derect machine hours were estumated as follows: a. Determine the per unit factory overhead allocated to the coinmercial and residential motors under the single plantwide factory owerhead rate method, using direct machine hour as the alocation base. Commercial per unit Residental per unit b. Determine the per-unit foctory overhead allocated to the commercial and residential motors under the multiple production departinent factory overhead rate method, using direct machime hours as the allocation bave for each department. Commercial 1 per unit Resudential 1 per unit c. Recommend to management a product costing approach, based on your analyses in (a) and (b). 1. The manogemont should consider mubple production department foctory overhead rate methods, because this methad calculates the cost more accurately and conaiders the fact that cormercal products use more costly overheads than residentiat products. 2. The manegement should consider single plantwife tactory owerhead rate methods, because this method calculates the cost more accurately and considers the fact shat ifs ovecheads are apolied extenly based on the dirnct labar heurs the final costs

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