Learning Objective 2Product Costs and Product Profitability Reports, using a Single Plantwide Factory Overhead RateIsaac Engines Inc. produces three products-pistons, valves, and cams-for the heavy equipmentindustry. Isaac Engines has a very simple production process and product line and uses a singleplantwide factory overhead rate to allocate overhead to the three products. The factory overheadrate is based on direct labor hours. Information about the three products for 20Y2 is as follows:PistonsValvesCamsBudgetedVolume(Units)6,00013,0001,000PistonsDirect LaborHours Per UnitValvesCamsIf required, round all per unit answers to the nearest cent.a. Determine the plantwide factory overhead rate.$28 ✔per dlh0.300.500.100.3 ✔ dlhThe estimated direct labor rate is $20 per direct labor hour. Beginning and ending inventories arenegligible and are, thus, assumed to be zero. The budgeted factory overhead for Isaac Engines is$235,200.0.5 dlh0.1 ✓dlhPrice PerUnitb. Determine the factory overhead and direct labor cost per unit for each product.Direct LaborFactory OverheadCost Per UnitHours Per Unit$$$4021558.40 ✔14Direct MaterialsPer Unit2.80$$9$$520Direct LaborCost Per Unit6102 ●Learning Objective 2c. Use the information provided to construct a budgeted gross profit report by product line for theyear ended December 31, 20Y2. Include the gross profit as a percent of sales in the last line of yourreport, rounded to one decimal place.RevenuesProduct CostsDirect materialsDirect laborFactory overheadTotal Product CostsIsaac Engines Inc.Product Line Budgeted Gross Profit ReportsFor the Year Ended December 31, 20Y2PistonsValvesGross profit (loss)Gross profit percentage of salesFeedback$$240,000 ✔54,000 ✔36,000✔50,400 ✔99,600 ✔$140,400 ✔ $66 X %$$273,00065,000 ✓✔130,000 ✔182,000377,000-104,000>-38 X %$$Cams55,00020,0002,0002,80024,80030,200<55 X %Check My Workc. Construct your report for each product as: Revenues - Direct Materials - Direct Labor - FactoryOverhead Gross ProfitRevenues Price x Unit VolumeDirect Materials = Direct Material Cost per Unit x Unit VolumeDirect Labor = Direct Labor Cost per Unit from Req. (b) x Unit VolumeFactory Overhead = Factory Overhead Cost per Unit from Req. (b) x Unit VolumeGross Profit Percentage of Sales = Gross Profit + Sales

Gross profit percentage :— It is the ratio between gross profit and net sales. It is calculated by…

Learning Objective 2 c. Use the information provided to construct a budgeted gross profit report by product line for the year ended December 31, 20Y2. Include the gross profit as a percent of sales in the last line of your report, rounded to one decimal place. Revenues Product Costs Direct materials Direct labor Factory overhead Total Product Costs Gross profit (loss) Gross profit percentage of sales Feedback Isaac Engines Inc. Product Line Budgeted Gross Profit Reports For the Year Ended December 31, 20Y2 Pistons Valves Check My Work $ $ $ 240,000 ✔ $ 54,000 36,000 ✔ 50,400 ✔ 140,400 ✔ $ 99,600 ✔ $ 66 X % $ 273,000 65,000 ✔ 130,000 182,000 ✔ 377,000 << -104,000 -38 X % $ $ $ Cams 55,000 20,000 2,000 2,800 24,800 30,200 55 X %

Learning Objective 2 c. Use the information provided to construct a budgeted gross profit report by product line for the year ended December 31, 20Y2. Include the gross profit as a percent of sales in the last line of your report, rounded to one decimal place. Revenues Product Costs Direct materials Direct labor Factory overhead Total Product Costs Gross profit (loss) Gross profit percentage of sales Feedback Isaac Engines Inc. Product Line Budgeted Gross Profit Reports For the Year Ended December 31, 20Y2 Pistons Valves Check My Work $ $ $ 240,000 ✔ $ 54,000 36,000 ✔ 50,400 ✔ 140,400 ✔ $ 99,600 ✔ $ 66 X % $ 273,000 65,000 ✔ 130,000 182,000 ✔ 377,000 << -104,000 -38 X % $ $ $ Cams 55,000 20,000 2,000 2,800 24,800 30,200 55 X %

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter12: Integer Linear Optimization_models

Section: Chapter Questions

Problem 6P: Hart Manufacturing makes three products. Each product requires manufacturing operations in three...

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