7.) Using the direct method, compute for the factory overhead rate of the D department if it apply overhead based on direct labor hours and budgeted direct labor hours for the period total to 75,000 hours.

Sylvie Corporation has three production departments: K, D, and C. It also has two service departments: Administration and Personnel. Administration costs are allocated based on value of assets employed, and Personnel costs are allocated based on number of employees. Assume that Administration provides more service to the other departments than does the Personnel Department. Department Direct Costs Employees Asset Value Administration 1,800,000 50 Personnel 700,000 20 900,000 1,200,000 K 1,400,000 30 600,000 400,000 10 300,000 C 500,000 20 1,600,000