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 Departments and Computing Departments output by the various departments.

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 Departments and Computing Department's output by the various departments. Service Department Maintenance (maintenance hours) Computing (minutes) Maintenance 0 249,600 Using Department Computing Etching 1,080 1,080 0 873,600 Finishing 8,640 124,800 Required: 1. 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. 2. Which of the three methods of service department cost allocation results in the most accurate overhead rates? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Use the reciprocal-services method to allocate service department costs. Calculate the overhead rates per dir the Etching Department and the Finishing Department. (Do not round intermediate calculations. Round the "C hour" to 3 decimal places. Amounts to be deducted should be indicated by a minus sign.) Service Departments Maintenance Computing $ 47,840 $ 290,000 Production Departments Etching Finishing Traceable costs $ 0 $ C Allocation of Maintenance Department costs Allocation of Computing Department costs Total service department costs allocated Overhead costs traceable to production departments Total overhead cost Direct-labor hours (DLH) Overhead rate per hour $ 0 $