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Please help me to solve this problem, Thanks! Problem 48-6 Step-Down Method versus Direct Method; Predetermined...

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please help me to solve this problem, Thanks!
Problem 48-6 Step-Down Method versus Direct Method; Predetermined Overhead Rates (L04-10, LO4. The Sendai Co., Ltd., of Japan
Required: 1. Allocate service department costs to consuming departments by the step-down method. Then compute predetermined o
w i od, the direct method, and the plantwide method Complete this question by entering your answers in the tabs below Require
UUROU O LULU 14). CHOU, L EUVE HIV UVOU LULU Wu We are job if the overhead rates were developed using the step-down method, t
Machine- Hours 260 Direct Labor- Hours Machining Department Assembly Department Total hours 278 116 Using the overhead rates
Machine- Hours 260 Direct Labor- Hours Machining Department Assembly Department Total hours Using the overhead rates computed
Problem 48-6 Step-Down Method versus Direct Method; Predetermined Overhead Rates (L04-10, LO4. The Sendai Co., Ltd., of Japan has budgeted costs in its various departments as follows for the coming year. Tactory Administration Custodial Services Personnel Maintenance Machining-overhead Assembly-overhead Total cost $ 819,840 98,337 26, 358 170,555 1,126,484 618.226 $2,859,800 The company allocates service department costs to other departments in the order listed below. Square Total Feet of Direct Number of Labor- Space Labor Machine- Employees Hours Occupied Tours Hours - 5,300 - 15,900 10,200 16 19,300 7,700 53 47.600 12,200 92 60,000 60,000 118,000 176,250 138 150,000 20,000 203.000 105,750 292,800 115,400 321.000 282,000 Department Factory Administration Custodial Services Personnel Maintenance Machining Assembly 11 340 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: Machine- Hours Direct Labor Hours 260 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 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
w i od, 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 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.) Machining Assembly Factory Administration $ 819,840 Custodial Services $ 98,337 Personnel $ 26,358 Maintenance $ 170,555 Departmental costs before allocation Allocations: Factory administration Custodial services Personnel Maintenance Total costs her location $ 819,540 $ 98,337 $ 26,350 $ 170,555 $ 0 $ Predetermined overhead rate Reguired 2 >
UUROU O LULU 14). CHOU, L EUVE HIV UVOU LULU Wu We are 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.) Personnel Maintenance Machining Assembly Factory Administration $ 819,840 Custodial Services $ 98,337 $ 26,358 $ 170,555 Departmental costs before allocation Allocations: Factory administration Custodial services Personnel Maintenance Total costs after allocation Predetermined overhead rate 819.840 $ 98.337 S 26,358 $ 170,555 $ 0 $ ( Required 1 Required )
Machine- Hours 260 Direct Labor- Hours Machining Department Assembly Department Total hours 278 116 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 Terences 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 rato per DLH ( Required 2 Required 4 Required a >
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 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 Overhead Cost Step-down method Direct method Plantwide method Required 3
Business Accounting
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Answers

1) Allocation of Service Dept cost using Step Down Method (Amounts in $)

Factory Administration Custodial Services Personnel Maintenance Machining Assembly
Departmental costs before allocation 819,840 98,337 26,358 170,555 1,126,484 618,226
Allocations:
Factory Administration (based on labor hours) (819,840) 44,520 (819,840*15,900/292,800) 54,040 (480,760*19,300/292,800) 133,280 (480,760*47,600/292,800) 168,000 (480,760*60,000/292,800) 420,000 (480,760*150,000/282,800)
Custodial Services (based on square feet) - (142,857) 11,011 (142,857*7,700/99,900) 17,446 (142,857*12,200/99,900) 85,800 (142,857*60,000/99,900) 28,600 (142,857*20,000/99,900)
Personnel (Based on no. of employees) - - (91,409) 17,119 (91,409*53/283) 29,716 (91,409*92/283) 44,574 (91,409*138/283)
Maintenance (Based on Machine hrs) (338,400) 211,500 (338,400*176.25/282) 126,900 (338,400*105.75/282)
Total Allocated Overheads (a) 0 0 0 0 1,621,500 1,238,300
Allocation Base (b) 176,250 machine hrs 203,000 labor hrs
Predetermined overhead rate (a/b) 9.20 per machine hour 6.10 per labor hr

2) Allocation of Service Dept cost using Direct Method (Amounts in $)

Factory Administration Custodial Services Personnel Maintenance Machining Assembly
Departmental costs before allocation 819,840 98,337 26,358 170,555 1,126,484 618,226
Allocations:
Factory Administration (based on labor hours) (819,840) 234,240 (819,840*60/210) 585,600 (819,840*150/210)
Custodial Services (based on square feet) - (98,337) 73,753 (98,337*60/80) 24,584 (98,337*20/80)
Personnel (Based on no. of employees) - - (26,358) 10,543 (26,358*92/230) 15,815 (26,358*138/230)
Maintenance (Based on Machine hrs) (170,555) 106,597 (170,555*176.25/282) 63,958 (170,555*105.75/282)
Total Allocated Overheads (a) 0 0 0 0 1,551,617 1,308,183
Allocation Base (b) 176,250 machine hrs 203,000 labor hrs
Predetermined overhead rate (a/b) 8.80 per machine hour 6.44 per labor hr

3) Plant wide Overhead rate = Total Overhead costs/Total Direct labor hours

= $2,859,800/321,000 hrs = $8.91 per labor hour

4) Calculation of Overhead Cost (Amounts in $)

Overhead Cost
Step-Down Method 2,904 [(260 MH*$9.20)+(84 LH*$6.10)]
Direct Method 2,829 [(260 MH*$8.80)+(84 LH*$6.44)]
Plantwide Method 1,034 (116 labor hrs*$8.91)
.

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