QRS Company has two support departments (Administration and Janitorial) and three producing departments (Fabricating, Assembly, and Finishing). Costs and activities are as follows:Administration Janitorial Fabricating Assembly Finishing Direct costs .....................$50,000 $30,000 $40,000 $50,000 $25,000 Number of employees .....10 30 40 20 Square feet .....................2,00010,000 28,000 15,000 Direct labor hours ............5,000 6,000 2,000 Administrative services are allocated based on the number of employees; janitorial services are allocated based on square footage. Overhead rates for the three producing departments are based on direct labor hours.

Assignment for Cost and Management Accounting I

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Required: Determine the overhead application rates for the producing departments using each of the three allocation methods: A. Direct allocation methodB. Sequential allocation methodC. Reciprocal allocation method