Selecting Cost Allocation Bases and Direct Method Allocations Seattle Company has three producing departments (P1, P2, and P3) for which direct department costs are accumulated. In January, the following indirect costs of operation were incurred.

Plant managers salary and office expense	$20,500
Plant security	6,000
Plant nurses salary and office expense	7,000
Factory depreciation (building)	20,000
Equipment depreciation	15,000
Machine maintenance	7,000
Plant cafeteria cost subsidy	5,000
	$80,500

The following additional data have been collected for the three producing departments:

	P1	P2	P3
Number of employees	20	30	10
Space occupied (square feet)	12,000	6,000	6,000
Direct labor hours	3,400	5,000	1,600
Machine hours	1,500	600	900
Number of nurse office visits	25	20	5

Required a. Determine the common basis for allocation for each of the four cost pools identified below. In addition, calculate the total cost in each of the four cost pools for January.

	Cost pool	Allocation base	Total Cost in pool
1.	Plant manager's exp.	AnswerDirect labor hoursMachine hoursNumber of employeesNumber of nurse office visitsSpace occupied (square feet)	Answer
	Cafeteria subsidy		Answer
			Answer
2.	Plant security	AnswerDirect labor hoursMachine hoursNumber of employeesNumber of nurse office visitsSpace occupied (square feet)	Answer
	Bldg depreciation		Answer
			Answer
3.	Nurse's expense	AnswerDirect labor hoursMachine hoursNumber of employeesNumber of nurse office visitsSpace occupied (square feet)	Answer
4.	Machine maintenance	AnswerDirect labor hoursMachine hoursNumber of employeesNumber of nurse office visitsSpace occupied (square feet)	Answer
	Equipment depreciation		Answer
			Answer

b. Determine the amounts allocated to the three producing departments using the allocation bases used in requirement (a).

	P1	P2	P3	Total
Allocated costs	Answer	Answer	Answer	Answer

c. How much indirect cost would be allocated to each producing department if Seattle Company were using a plantwide rate based on direct labor hours? Note: Round your final answers below to the nearest whole dollar. Note: Do not round the rates used in your calculations.

	P1	P2	P3	Total
Allocated costs	Answer	Answer	Answer	Answer

d. How much indirect cost would be allocated to each producing department if Seattle Company were using a plantwide rate based on machine hours? Note: Round your final answers below to the nearest whole dollar. Note: Do not round the rates used in your calculations.

	P1	P2	P3	Total
Allocated costs	Answer	Answer	Answer	Answer