EX.07.22

Reciprocal Method Ellers Company has two producing departments and two support departments. The following budgeted data pertain to these four departments: Support Departments General Factory Receiving Producing Departments Assembly Finishing $43,000 $74,000 Direct overhead $400,000 $160,000 Square footage 2,700 5.400 5,400 1,020 Number of receiving orders 300 1,680 Direct labor hours 25,000 40,000 Required: 1. Allocate the overhead costs of the support departments to the producing departments using the reciprocal method. (Round allocation ratios to two decimal places. Round allocated costs to the nearest dollar. If an amount is zero, enter"0".) Allocation ratios: General Factory Receiving Assembly Finishing Square footage 0.10 X 0.20 0.40 0.40 Number of receiving orders 0.10 0.56 X 0.56 0.34 7 Allocations: Direct overhead cost General Factory General Factory Receiving Assembly Finishing $ 43,000 x X 43,000 # 74,000 169,796 169,7967 137,143 83,265 $349,939 x $ 349,939 x 349,939 327,061 X X Receiving Total 2. Using direct labor hours, compute departmental overhead rates. (Round to the nearest cent.) ) Overhead Rate 13.99 X per direct labor hour Assembly Finishing 13.99 X per direct labor hour Fuck