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Calculating Departmental Overhead Rates Using Post$-$Allocation Costs

Chekov Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly.

Support Departments Producing Departments

Human

Resources General

Factory Fabricating Assembly

Direct costs $$180,000$ $$360,000$ $$115,000$ $$93,000$

Normal activity:

Number of employees $603565$

Square footage $1,1004,20016,800$

The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of square footage. Chekov Company uses the direct method of support department cost allocation. Solve for the allocated costs to Fabricating and Assembly using the direct method of support department cost allocation. The Fabricating Department overhead rate is based on normal activity of $90,000$ machine hours. The Assembly Department overhead rate is based on normal activity of $180,000$ direct labor hours.

Job $316$ required eight machine hours in Fabricating and four direct labor hours in Assembly. Total direct materials cost $$150,$ and total direct labor cost was $$65.$

Required:

$1.$ Calculate the overhead rate for Fabricating based on machine hours and the overhead rate for Assembly based on direct labor hours. If required, round your answers to the nearest cent. Use the rounded values for subsequent calculations.

Overhead Rate

Fabricating department $fill in the blank $1$

per mach. hr$.$

Assembly department $fill in the blank $2$

per DLH

$2.$ Using the overhead rates calculated in Requirement $1,$ calculate the cost of Job $316.$ If required, round your answer to the nearest cent.

$fill in the blank $3$

$3.$ What if Job $316$ had required two machine hour in Fabricating and four direct labor hours in Assembly? Direct labor and direct materials costs remained the same. Calculate the new cost of Job $316.$ If required, round your answer to the nearest cent.