Data table $ 6,400 648 22,104 Support departments: Building and grounds Personnel General plant administration Cafeteria: Operating loss Storeroom Operating departments: Machining 1,809 11,897 $ 42,858 $ 34,000 46,000 80,000 Assembly Total for support and operating departments $ 122,858 Print Done - Data table Direct Manufacturing Number of Labor-Hours Employees Square Feet of Floor Space Occupied Indirect Manufacturing Labor-Hours Number of Requisitions 0 0 0 0 0 0 0 900 0 0 Department Building and grounds Personnel General plant administration Cafeteria: operating loss Storeroom 0 36 0 0 0 9 1,000 0 0 9 14,400 4,500 4,500 36,000 19,700 0 Machining 45 5,000 15,000 3,000 8,000 14,000 6,000 2,000 Assembly 81 20,000 180 80,000 26,000 8,000 Total aBasis used is number of employees Print Done - . Requirements C 1. Using the step-down method, allocate support-department costs. Develop overhead rates per direct manufacturing labor-hour for machining and assembly. Allocate the costs of the support departments in the order given in this problem. Use the allocation base for each support department you think is most appropriate 2. Using the direct method, rework requirement 1. 3. Based on the following information about two jobs, determine the total overhead costs for each job by using rates developed in (a) requirement 1 and (b) requirement 2 Direct Manufacturing Labor-Hours Machining Assembly Job 88 20 7 Job 89 11 19 4. The company evaluates the performance of the operating department managers on the basis of how well they managed their total costs, including allocated costs. As the manager of the Machining Department, which allocation method would you prefer from the results obtained in requirements 1 and 2? Explain. o O Print Done Requirement 1. Using the step-down method, allocate support-department costs. Develop overhead rates per direct manufacturing labor-hour for machining and assembly. Allocate the costs of the support departments in the order given in this problem Use the allocation base for each support department you think is most appropriate. Begin by selecting the allocation base for each support department. Support Department Allocation Base Building and grounds Personnel General plant administration Cafeteria: operating loss Storeroom Using the step-down method, allocate support-department costs. Allocate the costs of the support departments in the order given in this problem. (Round all indirect allocation rates to the nearest cent and all other computations to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs.) Support Departments Operating Departments General Cafeteria Bldg and Plant Operating Grounds Personnel Admin. Loss Storeroom Machining Assembly Costs incurred Allocation of costs: Building and grounds Personnel General plant administration Cafeteria Storeroom Total budgeted costs of operating departments Develop overhead rates per direct manufacturing labor-hour for machining and assembly using the step-down method. (Round the overhead rates to three decimal places.) Step-down method: Overhead rate per direct manufacturing labor-hour Total costs allocated to department Direct manufacturing labor-hours Machining Assembly Requirement 2. Using the direct method, rework requirement 1 Using the direct method, allocate support-department costs. (Round cost allocations to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs.) Support Departments Operating Departments General Cafeteria Plant Operating Bldg and Grounds Personnel Admin. Loss Storeroom Machining Assembly Costs incurred Allocation of costs: Building and grounds Personnel General plant administration Cafeteria Storeroom Develop overhead rates per direct manufacturing labor-hour for machining and assembly using the direct method. (Round the overhead rates to three decimal places.) Direct method: Overhead rate per direct Total costs allocated to department Direct manufacturing labor-hours manufacturing labor-hour Machining Assembly Requirement 3. Based on the information about two jobs, determine the total overhead costs for each job by using rates developed in (a) requirement 1 and (b) requirement 2. Start by computing the total overhead costs for each job using the rates developed in (a) requirement 1 (the step-down method.) (Round the total overhead costs to the nearest cent.) (a) Step-down method: Total Overhead Costs Job 88 Machining Assembly Total cost of Job 88 Job 89 Machining Assembly Total cost of Job 89 Now compute the total overhead costs for each job using the rates developed in (b) requirement 2 (the direct method). (Round the total overhead costs to the nearest cent.) (b) Direct method: Total Overhead Costs Job 88 Machining Assembly Total cost of Job 88 Job 89 Machining Assembly Total cost of Job 89 Requirement 4. The company evaluates the performance of the operating department managers on the basis of how well they managed their total costs, including allocated costs. As the manager of the Machining Department, which allocation method would you prefer from the results obtained in requirements 1 and 2? Explain. The manager of machining department would since amount of overhead costs being allocated to the machining department