Mandelbrot Company produces fractals in two producing departments (generating and coloring) and two support departments (human resources and power). The following budgeted data pertain to these four departments:

Support Departments Producing Departments Human Resources Power Generating Coloring Overhead $144,000 $130,000 $50,000 $80,000 Payroll — $80,000 $160,000 $160,000 Kilowatt-hours 50,000 — 200,000 150,000 Direct labor hours — — 20,000 30,000 Costs of the human resources department are allocated on the basis of payroll, and costs of the power department are allocated on the basis of kilowatt-hours.

Required:

1. Allocate the overhead costs of the support departments to the producing de- partments using the reciprocal method.

2. Using direct labor hours, compute departmental overhead rates (to the nearest penny). lop8