Model, Inc., produces model automobiles made from metal. It operates two production departments, Molding and Painting, and has three service departments, Administration, Accounting, and Maintenance. The accumulated costs in the three service departments were $268,000, $395,000, and $203,000, respectively. Management is concerned that the costs of its service departments are getting too high. In particular, managers would like to keep the costs of service departments under $3.50 per unit on average. You have been asked to allocate service department costs to the two production departments and compute the unit costs. The company decided that Administration costs should be allocated on the basis of square footage used by each production and service department. Accounting costs are allocated on the basis of number of employees. Maintenance costs are allocated on the basis of the dollar value of the equipment in each department. The use of each base by all departments during the current period follows. Allocation Base Building area Employees Equipment value (in thousands) Administration 11,000 28 $ 50.00 Used by Accounting 61,100 Maintenance 16 $200.00 $ 15.50 47,000 56 $ 150.00 Molding 329,000 Painting 32,900 126 70 $ 50.00 Direct costs of the Molding Department included $232,500 in direct materials, $330,000 in direct labor, and $120,000 in overhead. The Painting Department's direct costs consisted of $217,000 in direct materials, $173,000 in direct labor, and $65,000 in overhead. Required: a. Using the step method, determine the allocated costs and the total costs in each of the two producing departments. Ignore self- usage (for example, ignore work done by Administration for itself). Rank order the allocation as follows: (1) Maintenance, (2) Accounting, and (3) Administration. b. Assume that 100,000 units were processed through these two departments. What is the unit cost for the sum of direct materials, direct labor, and overhead (1) for Molding, (2) for Painting, and (3) in total? c-1. Compute the cost per unit for the service department costs allocated to the production departments. c-2. Did the company meet management's standards of keeping service department costs below $3.50 per unit in the Molding Department? c-3. Did the company meet management's standards of keeping service department costs below $3.50 per unit in the Painting Department? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Req A Req B Req C1 Req C2 Req C3 Using the step method, determine the allocated costs and the total costs in each of the two producing departments. Ignore self-usage (for example, ignore work done by Administration for itself). Rank order the allocation as follows: (1) Maintenance, (2) Accounting, and (3) Administration. (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign.) Show less MODEL, INC. Step Method To Maintenance Accounting Administration Direct Costs $ 203,000 $ 235,000 S 268,000 Molding $ 562,000 Painting $390,000 FROM Maintenance Accounting Administration (203,000) 87,218 (322,218) X 6,759 x 30,480 65,414 137,160 21,805 76,200 (305,239) > Totals 0 0 < Req A 0 208,781 $ 973,355 20,878 $ 508,883 Req B > Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Req A Req B Req C1 Req C2 Req C3 Assume that 100,000 units were processed through these two departments. What is the unit cost for the sum of direct materials, direct labor, and overhead (1) for Molding, (2) for Painting, and (3) in total? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Unit Cost Molding Painting $ 6.83 4.55 Total $ 11.38 < Req A Req C1 > Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Req A Req B Req C1 Req C2 Req C3 Compute the cost per unit for the service department costs allocated to the production departments. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Unit Cost Molding Painting $ SAGA $ 4.11 1.19 < Req B Req C2 >