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Porter has two producing departments (Fabricating and Assembly) and three support departments (Maintenance, Human Resources (HR) and General Factory (GF)). Porter provided the following information

Porter has two producing departments (Fabricating and Assembly) and three support departments (Maintenance, Human Resources (HR) and General Factory (GF)). Porter provided the following information on the five departments:



Maintenance


HR


GF


Fabricating


Assembly


Direct overhead cost


$80,000



$120,000



$260,000



$93,400



$56,700



Machine hours


1,000



3,000



5,000



12,000



3,000



Direct labor hours


4,000



5,000



8,000



10,000



30,000



Square footage


500



2,500



10,000



12,000



18,000



Porter uses the sequential method of support department cost allocation, and support departments are ranked in order of direct overhead cost (from high to low). Maintenance is allocated based on machine hours, HR on direct labor hours, and GF on the basis of square footage. The Fabricating overhead rate is based on machine hours and the Assembly overhead rate is based on direct labor hours.

Calculate the allocation ratios to five significant digits and fill them into the following table:



Maintenance


HR


GF


Fabricating


Assembly


General Factory

















Human Resources

















Maintenance

















Using the allocation ratios, fill in the following table to allocate support department costs to the producing departments.



Maintenance


HR


GF


Fabricating


Assembly


Direct overhead cost


$80,000



$120,000



$260,000



$93,400



$56,700



Allocate:

















Maintenance

















Human Resources

















General Factory

















Total after allocation

















Notice that after allocation, zero dollars remain in the support departments and all overhead cost has been allocated to the producing departments. As a check on your work, add all direct overhead costs from the first line - it equals $610,100. Then add the totals after allocation - again, it equals $610,100.

Finally, calculate the overhead rates (rounded to the nearest cent) for Fabricating and Assembly.

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