Departmental Distribution of Estimated Overhead—Step Method; Rate Calculation; Job Order Costing. Tenzell Company has two producing departments. Machining and Assembly, and wo service departments. Maintenance and Personnel. The step method is used in allocating service department costs to producing departments, with Maintenance allocated first, based on square feet. In calculating predetermined factory overhead rates, machine hours are used as a base in Machining and direct labor hours are used as a base in .Assembly.

Budgeted monthly cost and other operating data are as follows:

Maintenance Personnel Machining Assembly Factoryoverhead.

. S30.000 S15,000

$150,000 S75.000 Squarefeet.

. 2,000 4,000 19,000 17,000 Number of employees.

Machinehours.

. 5 3

40 22.700 80 Direct laborhours.

8,000 16,625 Cost and related data pertaining to Job No. 3~52 are:

Machining: Machinehours. 10 Materials. S60 Directlabor.4hours @ S 6 Assembly: Materials. $ 7 Directlabor.11 hours @ S 9 Required:

(1) Develop predetermined factory overhead rates for Machining and Assembly.

(2) Compute the total cost ofJob No. 3752. CGA-Canada (adapted). Reprint with permission.