The Sendai Co., Ltd., of Japan has budgeted costs in its various departments as follows for the coming year:
| | | |
| Factory Administration | $ | 533,800 |
| Custodial Services | | 102,568 |
| Personnel | | 68,774 |
| Maintenance | | 151,718 |
| Machiningoverhead | | 1,851,536 |
| Assemblyoverhead | | 761,704 |
| Total cost | $ | 3,470,100 |
| |
The company allocates service department costs to other departments in the order listed below.
| Department | Number of Employees | Total Labor- Hours | Square Feet of Space Occupied | Direct Labor- Hours | Machine- Hours |
| Factory Administration | 25 | | 6,500 | | |
| Custodial Services | 17 | 9,400 | 2,000 | | |
| Personnel | 21 | 12,300 | 5,600 | | |
| Maintenance | 57 | 45,200 | 11,100 | | |
| Machining | 96 | 50,000 | 75,000 | 130,000 | 240,000 |
| Assembly | 144 | 150,000 | 25,000 | 169,000 | 30,000 |
| | 360 | 266,900 | 125,200 | 299,000 | 270,000 |
| |
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 occupied; 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 doesnt 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 | | Direct Labor-Hours |
| Machining Department | 280 | | 33 |
| Assembly Department | 14 | | 76 |
| Total hours | 294 | | 109 |
| | |
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.
Factory Administration Custodial Services Personnel Maintenance Machining-overhead Assembly-overhead Total cost $ 533,800 102,568 68,774 151,718 1,851,536 761,704 $3,478,100 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 25 6,500 17 9,400 2,000 21 12,300 5,600 57 45,200 11,100 96 50,000 75,000 130,000 240,000 144 150,000 25,000 169,000 30,000 360 266,900 125,200 299,000 270,000 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 occupied; 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: Machining Department Assembly Department Total hours Machine Hours 280 14 294 Direct Labor- Hours 33 76 109 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 Required 1 Required 2 Required 3 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 Maintenance Factory Custodial Administration Personnel Services $ 533 800 5 102,568 5 68,774 Machining Assembly $ 151,718 Departmental costs before allocation Allocations Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate 2 5 points Factory Administration Custodial Services Personnel Maintenance Machining-overhead Assembly-overhead Total cost $ 533,800 102,568 68,774 151,718 1,851,536 761,704 $3,470, 100 8 04:18:26 The company allocates service department costs to other departments in the order listed below. eBook Print 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 25 6,500 17 9,480 2,080 21 12,300 5,600 57 45,200 11,180 96 50,000 75,000 130,000 240,000 144 150,8825,889 169,682 30,000 360 266,900 125,280 299,000 270,eee References 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 occupied; 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: Machining Department Assembly Department Total hours Machine Hours 280 14 294 Direct Labor- Hours 33 76 109 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 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.) Factory Custodial Services Administration Maintenance Machining Personnel Assembly Departmental costs before allocation $ 533 800 5 102,568 5 $ 68,774 $ 151, 718 Allocations Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate 2 The Sendai Co., Ltd., of Japan has budgeted costs in its various departments as follows for the coming year: 5 points Factory Administration Custodial Services Personnel Maintenance Machining-overhead Assembly-overhead Total cost $ 533,800 102,568 68,774 151,718 1,851,536 761,704 $3,470,100 8 04:17:54 eBook The company allocates service department costs to other departments in the order listed below. Print Square Total Feet of Direct Number of Labor- Space Labor- Machine- Employees Hours Occupied Hours Hours 25 - 6,500 17 9,400 2,800 21 12,300 5,600 57 45,200 11,100 96 50,000 75,808 130,00 240,000 144 150,080 25,000 169,000 30,000 360 266,900 125,200 299,000 270,000 Department Factory Administration Custodial Services Personnel Maintenance Machining Assembly References 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 occupied; 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: Machining Department Assembly Department Total hours Machine Hours 280 14 294 Direct Labor- Hours 33 76 109 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 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 The Sendai 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 $ 533,800 102,568 68,774 151,718 1,851,536 761,704 $3,470, 100 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 25 6,500 17 9,400 2,000 21 12,300 5,600 57 45,200 11,100 96 50,000 75,000 130,000 240,000 144 150,000 25,000 169,000 30,000 360 266,900 125,200 299,000 270,000 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 occupied; 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: Machining Department Assembly Department Total hours Machine- Hours 280 14 294 Direct Labor- Hours 33 76 109 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 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 A Overhead Cost Step-down method Direct method Plantwide method
