Direct Method of Support Department Cost Allocation

Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly.

	Support Departments		Producing Departments
	Human Resources	General Factory	Fabricating	Assembly
Direct costs	$160,000	$340,000	$114,600	$93,000
Normal activity:
Number of employees		60	80	170
Square footage	1,000		5,700	13,300

The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of square footage. Valron Company uses the direct method of support department cost allocation.

Required:

1. Calculate the allocation ratios for the four departments using the direct method. If an amount is zero, enter "0". Round your answer to the nearest cent.

	Proportion of Driver Used by
	Human Resources	General Factory	Fabricating	Assembly
Human Resources
General Factory

2. Using the direct method, allocate the costs of the Human Resources and General Factory departments to the Fabricating and Assembly departments. If an amount is zero, enter "0".

	Support Departments			Producing Departments
	Human Resources	General Factory		Fabricating	Assembly
Direct costs	$	$		$	$
Allocate:
Human Resources
General Factory
Total after allocation	$	$		$	$