Reciprocal Method

Eilers Company has two producing departments and two support departments. The following budgeted data pertain to these four departments:

	Support Departments		Producing Departments
	General Factory	Receiving	Assembly	Finishing
Direct overhead	$500,000	$150,000	$42,000	$75,000
Square footage		2,700	5,400	5,400
Number of receiving orders	300		1,680	1,020
Direct labor hours			25,000	40,000

Required:

1. Allocate the overhead costs of the support departments to the producing departments using the reciprocal method. (Round allocation ratios to two decimal places. Round allocated costs to the nearest dollar. If an amount is zero, enter "0".)

Allocation ratios:

	General Factory	Receiving	Assembly	Finishing
Square footage
Number of receiving orders

Allocations:

	General Factory	Receiving	Assembly	Finishing
Direct overhead cost
General Factory
Receiving
Total

2. Using direct labor hours, compute departmental overhead rates. (Round to the nearest cent.)

	Overhead Rate
Assembly
Finishing