The Sendai Co, Ltd., of Japan has budgeted costs in its various departments as f

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The Sendai Co, Ltd., of Japan has budgeted costs in its various departments as follows for the coming year: 819,840 98,337 26, 358 170,555 1,126,484 618,226 Factory Adninistration Custodial Services Personnel 10 oints Maintenance Machining-overhead Assembly-overhead Total cost The company allocates service department bosts to other departments in the order listed below. Square Total Feet of Direct Print Number of Labor-SpaceLabor- Machine Factory Administration Custodial Services 30 Personnel Maintenance Machining Asseably 5,300 11 15,900 10,200 19,3007,700 47,600 12,200 53 92 138 60,000 60,000 118,000 176,250 150,000 20,000 203,000 10: 750 292, 800 115,400 321,000 282,000 Machining and Assembly are operating departments: the other departments are service departments. Factory Administration 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 () above, this time using the direct method. Again compute predetermined overhead rates in Machining and Assembly 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 Prev( 1 of 3 ??? Next >

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1. Base Factory Admin Custodial Personnel Maintenance Machining Assembly Operating Department Cost 1126484 618226 Cost to be allocated 819840 98337 26358 170555 Allocation: Factory Admin Labor Hours -819840 44520 54040 133280 168000 420000 Custodial Sq Foot -142857 11011 17446 85800 28600 Personnel Employees -91409 17119 29716 44574 Maintenance Machine Hour -338400 211500 126900 Total Overhead after allocation 0 0 0 0 1621500 1238300 Machine Hour/Labor Hour 176250 203000 Predetermined Overhead 9.2 6.1 Working Allocation: Base Factory Admin Custodial Personnel Maintenance Machining Assembly Total Factory Admin Labor Hours 15900 19300 47600 60000 150000 292800 Allocation 44520 54040 133280 168000 420000 819840 Custodial Sq Foot 7700 12200 60000 20000 99900 Allocation 11011 17446 85800 28600 142857 Personnel Employees 53 92 138 283 Allocation 17119 29716 44574 91409 Maintenance Machine Hour 176250 105750 282000 Allocation 211500 126900 338400 2. Base Factory Admin Custodial Personnel Maintenance Machining Assembly Operating Department Cost 1126484 618226 Cost to be allocated 819840 98337 26358 170555 Allocation: Factory Admin Labor Hours -819840 0 0 0 234240 585600 Custodial Sq Foot -98337 0 0 73753 24584 Personnel Employees -26358 0 10543 15815 Maintenance Machine Hour -170555 106597 63958 Total Overhead after allocation 0 0 0 0 1551617 1308183.2 Machine Hour/Labor Hour 176250 203000 Predetermined Overhead 8.80 6.44 Working Allocation: Base Factory Admin Custodial Personnel Maintenance Machining Assembly Total Factory Admin Labor Hours 60000 150000 210000 Allocation 234240 585600 819840 Custodial Sq Foot 60000 20000 80000 Allocation 73753 24584 98337 Personnel Employees 92 138 230 Allocation 10543 15815 26358 Maintenance Machine Hour 176250 105750 282000 Allocation 106597 63958 170555 3. Total Overheads 2859800 Total Direct Labor Hours 292800 Predetermined OVH Rate                                                         9.77

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