Exercise 4-51 (Appendix 4B) Direct Method of Support Department Cost Allocation Stevenson Company is divided into two company allocates power and general factory costs to each operating division using method. Power costs are allocated on the basis of the number of machine hours and general factory costs on the basis of square footage. Support department cost allocations usingthe direct method are based on the following data operating divisions: Battery and Small Motors. The the direct Support Departments Operating Divisions General Factory $430,000 Btry Small Motors Overhead costs Machine hours Square footage Direct labor hours $160,000 2,000 1,000 $163,000 7,000 5,000 18,000 $84,600 1,000 15.000 60,000 2,000 Required 1. Calculate the allocation ratios for Power and General Factory. (Note: Carry these calculations out to four decimal places.) 2. Allocate the support service costs to the operating divisions. (Note: Round all amounts to the nearest dollar.) 3. Assume divisional overhead rates are based on direct labor hours. Calculate the overhead rate for the Battery Division and for the Small Motors Division. (Note: Round overhead rates to the nearest cent.) Exercise 4-52 (Appendix 4B) Sequential Method of Support Department Cost Allocation Refer to Exercise 4-51 for data. Now assume that Stevenson uses the sequential method to al- locate support department costs to the operating divisions. General Factory is allocated first in the sequential method for the company Required: 1. Calculate the allocation ratios for Power and General Factory. (Note: Carry these calculations out to four decimal places.) llocate the support service costs to the operating divisions. (Note: Round all amounts to the nearest dollar.) 3. Assume divisional overhead rates are based on direct labor hours. Calculate the overhead rate for the Battery Division and for the Small Motors Division. (Note: Round overhead es to the nearest cent.)