Allocating to smooth cost over varying levels of production Production workers for Gomez Manufacturing Company provided 320 hours of labor in January and 480 hours in February. Gomez expects to use 4,000 hours of labor during the year. The rental fee for the manufacturing facility is $7,200 per month.

Required Explain why allocation is needed. Based on this information, how much of the rental cost should be allocated to the products made in January and to those made in February?