Celestial Artistry Company is developing departmental overhead rates based on direct$-$labor hours for its two production departments,

Etching and Finishing. The Etching Department employs $30$ people and the Finishing Department employs $70$ people. Each person in

these two departments works $1,200$ hours per year. The production$-$related overhead costs for the Etching Department are budgeted

at $$280,000,$ and the Finishing Department costs are budgeted at $$400,000.$ Two service departments, Maintenance and Computing,

directly support the two production departments. These service departments have budgeted costs of $$47,840$ and $$290,000,$

respectively. The production departments' overhead rates cannot be determined until the service departments' costs are allocated.

The following schedule reflects the use of the Maintenance Department's and Computing Department's output by the various

departments.

Required:

Use the reciprocal$-$services method to allocate service department costs. Calculate the overhead rates per direct$-$labor hour for the

Etching Department and the Finishing Department.

Which of the three methods of service department cost allocation results in the most accurate overhead rates?