Support Departments	Producing Departments
	Personnel	Maintenance	Fabrication	Assembly
Budgeted overhead	$160,000	$288,000	$560,000	$640,000
Direct labor hours	8,000	10,000	32,000	40,000
Machine hours	12,000	15,000	48,000	32,000
Number of employees	16	20	60	100

The company does not divide costs into fixed and variable components. Personnel costs are allocated based on the number of employees, and maintenance costs are allocated based on machine hours.

Predetermined overhead rates for fabrication and assembly are based on direct labor hours. (Round to the nearest dollar).

12. The amount of maintenance costs allocated to the Assembly Department using the direct method would be

Direct method:

Allocation proportion = 32,000/80,000 = 0.40

Cost allocation: 0.4 x $288,000 = $115,200

1. Where did 80,000 come from?

2. why is $288,000 being used?