Problem 4B-6 Step-Down Method versus Direct Method; Predetermined Overhead Rates (L04-10, L04- 11) The Sendal Co., Ltd., of Japan has budgeted costs in its various departments as follows for the coming year. Factory Administration Custodial Services Personnel Maintenance Machining-overhead Assembly-overhead Total cost $ 605,500 229,926 65,789 324,785 1,697,400 542,200 $3,465,600 The company allocates service department costs to other departments in the order listed below. Department Factory Administration Custodial Services Personnel Maintenance Machining Assembly Square Total Feet of Direct Number of Labor Space Labor - Machine- Employees Hours Occupied Hours Hours - 5,600 12 9,900 6,900 19,600 7,700 53,000 10,500 100,000 140,000 99,000 280,000 120 250,000 40,000 236,000 80,000 320 432,500 210,700 335,000 360,000 80 Machining and Assembly are operating departments; the other departments are service departments. Factory Administration is allocated based on labor-hours: Custodial Services based on square feet occupled; Personnel based on number of employees, and Maintenance based on machine-hours. Assembly 120 320 250.000 40.000 236,000 80,000 432,500 210,700 335,000 360,000 Machining and Assembly are operating departments: the other departments are service departments. Factory Administration is allocated based on labor-hours: Custodial Services based on square feet occupled; Personnel based on number of employees; and Maintenance based on machine-hours. Required: 1. Allocate service department costs to consuming departments by the step-down method. Then compute predetermined overhead rates in the operating departments using machine-hours as the allocation base in Machining and direct labor-hours as the allocation base in Assembly. 2. Repeat (1) above, this time using the direct method. Again compute predetermined overhead rates in Machining and Assembly 3. Assume that the company doesn't bother with allocating service department costs but simply computes a single plantwide overhead rate that divides the total overhead costs (both service department and operating department costs) by the total direct labor hours Compute the plantwide overhead rate. 4. Suppose a job requires machine and labor time as follows: Machine Hours 266 Direct Labor- Hours Machining Department Assembly Department Total hours 110 Using the overhead rates computed in (1). (2), and (3) above, compute the amount of overhead cost that would be assigned to the job if the overhead rates were developed using the step-down method, the direct method, and the plantwide method. Complete this question by entering your answers in the tabs below Help Save & Exit Check Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Allocate service department costs to consuming departments by the step-down method. Then compute predetermined overhead rates in the operating departments using machine-hours as the allocation base in Machining and direct labor-hours as the allocation base in Assembly. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round "Predetermined overhead rates" to 2 decimal places and other final answers to the nearest whole dollar amount.) Show less Custodial Personnel Machining Assembly Factory Administration $ 605,500 Custodial Services $ 229,926 Maintenance 324.785 $ Departmental costs before allocation Allocations: Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate $ 605,500 $ 229,926 1,789 $ 324,785 $ 0 $ 0 Required 2 > Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Repeat requirement 1 above, this time using the direct method. Again compute predetermined overhead rates in Machining and Assembly. Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round Intermediate calculations. Round "Predetermined overhead rates to 2 decimal places and other final answers to the nearest whole dollar amount Machining Factory Administration | $ 605,500 Machinine Custodial Services $ 229,020 Rance Personnel $ 65,780 Assembly Maintenance $ 324.785) Departmental costs before allocation Allocations: Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate S 605,500 5 65,789 $ 324,785 $ Required 1 Required 3 > Using the overhead rates computed in (1). (2), and (3) above, compute the amount of overhead cost that would be assigned to the la the overhead rates were developed using the step-down method, the direct method, and the plantwide method. Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Assume that the company doesn't bother with allocating service department costs but simply computes a single plantwide overhead rate that divides the total overhead costs (both service department and operating department costs) by the total direct labor-hours. Compute the plantwide overhead rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Plantwide overhead rate per DLH Using the overhead rates computed In (1). (2), and (3) above, compute the amount of overhead cost that would be assigned to the jo the overhead rates were developed using the step-down method, the direct method, and the plantwide method Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Using the overhead rates computed in (1), (2), and (3) above, Compute the amount of overhead cost that would be assigned to the job if the overhead rates were developed using the step-down method, the direct method, and the plantwide method. (Do not round intermediate calculations. Round "Predetermined overhead rates" to 2 decimal places and other final answers to the nearest whole dollar amount.) Show less Overhead Cost Step-down method Direct method Plantwide method Required 3 Required ) Problem 4B-6 Step-Down Method versus Direct Method; Predetermined Overhead Rates (L04-10, L04- 11) The Sendal Co., Ltd., of Japan has budgeted costs in its various departments as follows for the coming year. Factory Administration Custodial Services Personnel Maintenance Machining-overhead Assembly-overhead Total cost $ 605,500 229,926 65,789 324,785 1,697,400 542,200 $3,465,600 The company allocates service department costs to other departments in the order listed below. Department Factory Administration Custodial Services Personnel Maintenance Machining Assembly Square Total Feet of Direct Number of Labor Space Labor - Machine- Employees Hours Occupied Hours Hours - 5,600 12 9,900 6,900 19,600 7,700 53,000 10,500 100,000 140,000 99,000 280,000 120 250,000 40,000 236,000 80,000 320 432,500 210,700 335,000 360,000 80 Machining and Assembly are operating departments; the other departments are service departments. Factory Administration is allocated based on labor-hours: Custodial Services based on square feet occupled; Personnel based on number of employees, and Maintenance based on machine-hours. Assembly 120 320 250.000 40.000 236,000 80,000 432,500 210,700 335,000 360,000 Machining and Assembly are operating departments: the other departments are service departments. Factory Administration is allocated based on labor-hours: Custodial Services based on square feet occupled; Personnel based on number of employees; and Maintenance based on machine-hours. Required: 1. Allocate service department costs to consuming departments by the step-down method. Then compute predetermined overhead rates in the operating departments using machine-hours as the allocation base in Machining and direct labor-hours as the allocation base in Assembly. 2. Repeat (1) above, this time using the direct method. Again compute predetermined overhead rates in Machining and Assembly 3. Assume that the company doesn't bother with allocating service department costs but simply computes a single plantwide overhead rate that divides the total overhead costs (both service department and operating department costs) by the total direct labor hours Compute the plantwide overhead rate. 4. Suppose a job requires machine and labor time as follows: Machine Hours 266 Direct Labor- Hours Machining Department Assembly Department Total hours 110 Using the overhead rates computed in (1). (2), and (3) above, compute the amount of overhead cost that would be assigned to the job if the overhead rates were developed using the step-down method, the direct method, and the plantwide method. Complete this question by entering your answers in the tabs below Help Save & Exit Check Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Allocate service department costs to consuming departments by the step-down method. Then compute predetermined overhead rates in the operating departments using machine-hours as the allocation base in Machining and direct labor-hours as the allocation base in Assembly. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round "Predetermined overhead rates" to 2 decimal places and other final answers to the nearest whole dollar amount.) Show less Custodial Personnel Machining Assembly Factory Administration $ 605,500 Custodial Services $ 229,926 Maintenance 324.785 $ Departmental costs before allocation Allocations: Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate $ 605,500 $ 229,926 1,789 $ 324,785 $ 0 $ 0 Required 2 > Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Repeat requirement 1 above, this time using the direct method. Again compute predetermined overhead rates in Machining and Assembly. Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round Intermediate calculations. Round "Predetermined overhead rates to 2 decimal places and other final answers to the nearest whole dollar amount Machining Factory Administration | $ 605,500 Machinine Custodial Services $ 229,020 Rance Personnel $ 65,780 Assembly Maintenance $ 324.785) Departmental costs before allocation Allocations: Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate S 605,500 5 65,789 $ 324,785 $ Required 1 Required 3 > Using the overhead rates computed in (1). (2), and (3) above, compute the amount of overhead cost that would be assigned to the la the overhead rates were developed using the step-down method, the direct method, and the plantwide method. Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Assume that the company doesn't bother with allocating service department costs but simply computes a single plantwide overhead rate that divides the total overhead costs (both service department and operating department costs) by the total direct labor-hours. Compute the plantwide overhead rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Plantwide overhead rate per DLH Using the overhead rates computed In (1). (2), and (3) above, compute the amount of overhead cost that would be assigned to the jo the overhead rates were developed using the step-down method, the direct method, and the plantwide method Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 Required 4 Using the overhead rates computed in (1), (2), and (3) above, Compute the amount of overhead cost that would be assigned to the job if the overhead rates were developed using the step-down method, the direct method, and the plantwide method. (Do not round intermediate calculations. Round "Predetermined overhead rates" to 2 decimal places and other final answers to the nearest whole dollar amount.) Show less Overhead Cost Step-down method Direct method Plantwide method Required 3 Required )