Departmental Distribution of Estimated Overhead; Direct Method and Rate Calculation; Parts of Step and Simultaneous Methods. Great Manufacturing has two producing departments, Grinding and Smoothing, and two service departments, Maintenance and General Factory. Departmental overhead costs for the coming year have been budgeted as follows, before the distribution of service department costs to producing departments: Grinding, $175,000; Smoothing, $230,000; Maintenance, $76,000; and General Factory, $200,000. Maintenance costs are allocated based on hours of maintenance services provided. General Factory costs are allocated based on the maximum number of employees during the year.

Overhead will be applied to products using predetermined departmental overhead rates. The predeter¬ mined rate in Grinding is based on machine hours, and the predetermined rate in Smoothing is based on direct labor hours. The factory survey for the coming year is summarized as follows:

Grinding Smoothing Maintenance General Factory Direct labor hoursused.

7,500 30,000 0

0 Machine hoursused.

4,000 2,000 0

0 Hours of maintenance service used.

180 900 200 720 Number of materials requisitions.

200 10 30 10 Average number of employees.

5 2

1 2

Maximum number of employees.

6 3

1 2

Required:

(1) Calculate, to the nearest cent, the predetemiined departmental overhead rates for the coming year, using the direct method to allocate service department costs.

(2) Calculate, to the nearest cent, the predetemiined departmental overhead rates for the coming year, using the simultaneous method.

(3) Calculate, to the nearest cent, the predetermined departmental overhead rates for the coming year, using the step method. Use the following department allocation sequence: first Maintenance, then General Factory.