Products manufactures its products in two separatedepartments: machining and assembly. Total manufacturing overhead costs for the year are budgeted at $1.14 million. Of thisamount, the Machining Department incurs$650,000(primarily for machine operation anddepreciation) while the Assembly Department incurs $490,000. Gregoire Products estimates it will incur 6,000 machine hours(all in the MachiningDepartment) and13,500 direct labour hours (2,500 in the Machining Department and 11,000

in the AssemblyDepartment) during the year. Gregoire Products currently uses a plantwide overhead rate based on direct labour hours to allocate overhead.However, the company is considering refining its overhead allocation system by using departmental overhead rates. The Machining Department would allocate its overhead using machine hours(MH), but the Assembly Department would allocate its overhead using direct labour(DL) hours. The following chart shows the machine hours(MH) and direct labour(DL) hours incurred by Jobs 500 and 501 in each productiondepartment:

Requirement 5. Compute the total amount of overhead allocated to each job if Gregoire Products uses departmental overhead rates. Job 500 Job 501 Overhead allocation - Machining Department Overhead allocation - Assembly Department Total overhead allocationData table Machining Assembly Department Department Job 500 . . . . 7 MH 12 DL hours 3 DL hours Job 501 . . .. 14 MH 12 DL hours 3 DL hoursRequirement 6. Do both of the allocation systems accurately reflect the resources that each job used? Explain. The single plantwide overhead rate assigned of overhead to both jobs. The departmental rates assign to Job 501 than Job 500 due to the used. This seems