(APPENDIX 16B) SEQUENTIAL METHOD OF SUPPORT DEPARTMENT COST ALLOCATION Refer to Exercise 16-44 for data. Now assume that Dexter Company uses the sequential method to allocate support department costs to the producing departments. Human Resources is allocated first in the sequential method for Dexter.

Required:

. Calculate the allocation ratios for Power and Human Resources. (Carry these calculations out to three significant digits.)

. Allocate the support service costs to the producing departments.

. Assume departmental overhead rates are based on direct labor hours. Calculate the overhead rate for the Battery Division and for the Small Motors Division. (Round overhead rates to the nearest cent.)

Problems Problem