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a. Allocate the cost of service departments to operating departments using Step- method and compute the overhead rate per hour.for HA and PE b. Allocate the cost of service departments to operating departments using Reciprocal method and compute for the overhead rate per hour for HA and PE

a. Allocate the cost of service departments to operating departments using Step- method and compute the overhead rate per hour.for HA and PE b. Allocate the cost of service departments to operating departments using Reciprocal method and compute for the overhead rate per hour for HA and PE

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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help me answer the letter b only

Hulinghehe Manufacturing Corp. has two operating departments, Dept.HA and Dept. PE and two support departments: UTILITIES and PERSONNEL. Budgeted overhead costs for the year and other statistical information follows: Overhead Cost P 800,000 600,000 Operating Dept. HA PE Service Dept. Utilities Personnel 300,000 200,000 Personnel Space Occupied Processed Cost Driver 60,000 sq.ft. 30,000 sq.ft. 5,000 sq. ft. 10,000 sq. ft. 800 600 Machine hour Direct labor hours 100 Square footage 50 #personnel processed Department HA budgeted 20,000 machine hours for the year, while Department PE budgeted 15,000 direct labor hours. Required: a. Allocate the cost of service departments to operating departments using Step- method and compute the overhead rate per hour.for HA and PE b. Allocate the cost of service departments to operating departments using Reciprocal method and compute for the overhead rate per hour for HA and PE
Transcribed Image Text:Hulinghehe Manufacturing Corp. has two operating departments, Dept.HA and Dept. PE and two support departments: UTILITIES and PERSONNEL. Budgeted overhead costs for the year and other statistical information follows: Overhead Cost P 800,000 600,000 Operating Dept. HA PE Service Dept. Utilities Personnel 300,000 200,000 Personnel Space Occupied Processed Cost Driver 60,000 sq.ft. 30,000 sq.ft. 5,000 sq. ft. 10,000 sq. ft. 800 600 Machine hour Direct labor hours 100 Square footage 50 #personnel processed Department HA budgeted 20,000 machine hours for the year, while Department PE budgeted 15,000 direct labor hours. Required: a. Allocate the cost of service departments to operating departments using Step- method and compute the overhead rate per hour.for HA and PE b. Allocate the cost of service departments to operating departments using Reciprocal method and compute for the overhead rate per hour for HA and PE
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