16)

Map of manufacturing overhead assignment

Service departments Operating departments

Production
mgmt Maintenance Warehouse Stamping
Renting (fixed) R$3,200
Indirect labor R$896 R$170 R$140 R$532
Energy R$148 R$240 R$240 R$2,400
Indirect raw materials
Manufacturing overhead - R$336 R$112 R$90 R$159
total R$4,580 R$522 R$470 R$3,091

Production mgmt - cost

assignment R$458 R$458 R$1,603
Subtotal R$980 R$928 R$4,694
Maintenance - cost assignment R$0 R$392
Subtotal R$928 R$5,086
Warehouse - cost assignment R$464
Subtotal R$5,550
HINGES R$3,329
LOCKS R$2,221

60% 40%
Direct costs Hinges Locks TOTAL
Direct raw materials R$8,342 R$5,568
Direct labor R$6,048 R$4,032
Total direct costs R$14,390 R$9,600 R$23,990
Manufacturing overhead R$5,195 R$6,405 R$11,600
Total manufacturing costs R$19,585 R$16,005 R$35,590
Number of units 12,000 4,000
Unit cost R$1.63 R$4.00
 Operating departments

Drilling Assembling TOTAL

R$3,200
R$672 R$390 R$2,800
R$432 R$1,340 R$4,800
R$57 R$46 R$800 Machine-hours
R$1,161 R$1,776 R$11,600 Stamping 4,800 40%

R$1,374 R$687 Drilling 4,200 35%

R$2,535 R$2,463 Assembling 3,000 25%
R$343 R$245 12,000 100%
R$2,878 R$2,708 R$11,600
R$232 R$232
R$3,110 R$2,940 R$11,600 Number of employees
R$1,865 R$5,195 Warehouse 10 10%
R$1,245 R$2,940 R$6,405 Maintenance 10 10%
Stamping 35 35%
Drilling 30 30%
Assembling 15 15%
Application of the proportion - without the step down method! 100 100%
Direct costs Hinges Locks TOTAL
Direct raw materials R$8,342 R$5,568
Direct labor R$6,048 R$4,032
Total direct costs R$14,390 R$9,600
Manufacturing overhead 6,958 4,642 11,600
Total manufacturing cost R$21,348 R$14,242 R$35,590
Number of units 12000 4000
Unit cost R$1.78 R$3.56

By just aplying the proportion of direct costs from each product to the total manufacturing overhead, it will allocate co
 Number of requisitions
600 50%

300 25%
300 25%
1,200 100%

mployees

overhead, it will allocate costs from Assembling to Hinges, a department that this product does not use, it is not fair, that is w
it is not fair, that is why the unit cost increases!