x Data table $ 6,400 tion 2,550 37,480 370 Support departments: Building and grounds Personnel General plant administration Cafeteria: Operating loss Storeroom Operating departments: Machining Assembly Total for support and operating departments 1,075 $ rating departo 47,875 direct manufd ad rates to three de $ 33,000 45,000 78,000 $ 125,875 allocated to a - Data table Direct Manufacturing Labor-Hours 0 0 Indirect Manufacturing Labor-Hours 0 Number of Requisitions 0 0 0 0 Number of Employees 0 0 40 10 5 55 140 Department Building and grounds Personnel General plant administration Cafeteria: operating loss Storeroom Machining Assembly 0 Square Feet of Floor Space Occupied 0 2,500 16,000 4,000 1,000 44,000 12,500 0 0 0 0 0 2,000 3,000 10,000 13,000 5,000 15,000 3,000 2,000 20,000 250 80,000 28,000 5,000 Total Basis used is number of employees The Downhill Dash Company has prepared department overhead budgets for budgeted-volume levels before allocations as follows: 5 Click the icon to view the department overhead budgets.) Management has decided that the most appropriate inventory costs are achieved by using individual department overhead rates. These rates are developed after support-department costs are allocated to operating departments. Bases for allocation are to be selected from the following: (Click the icon to view the data.) Read the requirements Requirement 1. Using the step-down method, allocate support-department costs. Develop overhead rates per direct manufacturing labor-hour for machining and assembly Allocate the costs of the support departments in the order given in this problem. Use the allocation base for each support department you think is most appropriate. Begin by selecting the allocation base for each support department Allocation Base Support Department Building and grounds Personnel General plant administration Cafeteria: operating loss Storeroom Using the step-down method, allocate support department costs. Allocate the costs of the support departments in the order given in this problem. (Round all indirect allocation rates to the nearest cent and all other computations to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs.) Operating Departments Support Departments General Cafeteria Plant Operating Personnel Admin. Loss Bldg and Grounds Storeroom Machining Assembly Costs incurred Allocation of costs: Building and grounds Personnel General plant administration Cafeteria Storeroom Total budgeted costs of operating departments Develop overhead rates per direct manufacturing labor-hour for machining and assembly using the step-down method. (Round the overhead rates to three decimal places.) Overhead rate per direct manufacturing labor-hour Direct manufacturing labor-hours Step-down method: Total costs allocated to department Machining Assembly Requirement 2. Using the direct method, rework requirement 1. Using the direct method, allocate support-department costs. (Round cost allocations to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs.) Operating Departments Support Departments General Cafeteria Plant Operating Personnel Admin. Loss Bldg and Grounds Storeroom Machining Assembly Costs incurred Allocation of costs: Building and grounds Personnel General plant administration Cafeteria Storeroom Total budgeted costs of operating departments Develop overhead rates per direct manufacturing labor-hour for machining and assembly using the direct method. (Round the overhead rates to three decimal places.) Direct method: Overhead rate per direct manufacturing labor-hour Total costs allocated to department Direct manufacturing labor-hours Machining Assembly Requirement 3. Based on the information about two jobs, determine the total overhead costs for each job by using rates developed in (a) requirement 1 and (b) requirement 2 Start by computing the total overhead costs for each job using the rates developed in (a) requirement 1 (the step-down method.) (Round the total overhead costs to the nearest cent.) (a) Step-down method: Total Overhead Costs Job 88 Machining Assembly Total cost of Job 88 Job 89: Machining Assembly Total cost of Job 89 Now compute the total overhead costs for each job using the rates developed in (b) requirement 2 (the direct method). (Round the total overhead costs to the nearest cent.) (b) Direct method: Total Overhead Costs Job 88 Machining Assembly Total cost of Job 88 Job 89 Machining Assembly Total cost of Job 89 Requirement 4. The company evaluates the performance of the operating department managers on the basis of how well they managed their total costs, including allocated costs. As the manager of the Machining Department, which allocation method would you prefer from the results obtained in requirements 1 and 2? Explain. since amount of overhead costs being The manager of machining department would allocated to the machining department