The Sendai Co. Ltd. of Japan has budgeted costs in its various departments as follows for the coming year Factory Administration Custodial Services Personnel Haintenance Machining-overhead Assembly-overhead Total cost 819,840 98,337 26,356 170, SSS 1,126,484 618, 226 12,859,600 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 5,500 11 15,900 10,200 19,300 7,700 47,600 12,200 60,000 60,800 118,000 176, 250 150,000 20,000 200,000 105,750 340 292,800 115,480 321.000 282,00 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: 4. Suppose a job requires machine and labor time as follows: Machine- Hours 260 Direct Labor Hours Machining Department Assembly Department Total hours 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 Repeat requirement 1 above, this time using the direct method. Again compute predetermined overhead rates in Machining and Assembl- (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. not round intermediate calculations. Round "Predetermined overhead rates" to 2 decimal places and other final answers to the nearest dollar amount.) Show le Personnel Maintenance Machining Assembly Factory Administration $ 819,840 Custodia Services $ 98,337 $ 26,358 $ 170,555 (819,840) (98,337) Departmental costs before allocation Allocations: Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate (170,555) 0 $ 0 $
