Wakowski Company's annual budget for its three support departments (administration, legal/accounting, and maintenance/engineering) and its two production departments (processing and finishing) is as follows:

a. Prepare a cost distribution that allocates support department costs using the step method. Assume the benefits-provided ranking is the order in which the departments are listed. The allocation bases for the support department are
(1) Administration: number of employees,
(2) Legal/accounting: floor space,
(3) Maintenance/ engineering: number of hours.
Calculate the factory overhead (OH) rates using 400,000 direct labor hours in processing and 300,000 direct labor hours in finishing.
Round OH rates to the nearest $0.10.
b. Calculate the factory overhead rates per direct labor hour using the direct method.
Round OH rates to the nearest $0.10.
c. Calculate the factory overhead rates per direct labor hour using the algebraic method. Round percentages to three decimal points. Round OH rates to the nearest$0.10.

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ANNUAL BUDGET $000 omitted) Legal/ Maintenance/ Administration Accounting Engineering Processing Finishing Total 1,400 $1,800 Direct labor Direct material Insurance Depreciation Miscellaneous $1,000 55,600 4,000 $13,800 2,400 3,920 ,640 1,180 360 $7520 7 $20,900 140 180 150 160 800 100 600 180 140 300 120 Total 2130 S1,680 ANNUAL BUDGET ($000 omitted) Legal Maintenance/ Administration Accounting Engineering Processing Finishing Total Number of Sq. ft. of floor Maint/eng. hours 40 300 880 800 1,600 2,000 5,400 30 30 136 440