Problem 4B-6 Step-Down Method versus Direct Method; predetermined overhead Rates [LO4-10, LO4. 11] points The Sendai Co., Ltd., of Japan has budgeted costs in its various departments as follows for the coming year. Factory Administration Custodial Services Personnel Maintenance Machining overhead Assembly-overhead stal $ 438,769 116. ,263 45,692 141,258 874,528 181 $2 .83. Eee Print The company allocates service department costs to other departments in the order listed below. Department Factory Administration Custodial services Personnel Maintenance Machining Assembly Square Total Feet of Direct Number of Labor. Space Labor. Machine EmployeesHours occupied hours Hours 27 11 11,693 3,690 18 16,793 8,690 44,593 16,000 63,093 69,890 112,900 180,000 96 159,039 23,890 227,9 36.99 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