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A Company has two support departments (Administration andJanitorial) and three producing departments (Fabricating, Assembly,and Finishing). Costs and activities are as follows:

                                        Administration     Janitorial      Fabricating      Assembly      Finishing

Direct costs........................    $50,000           $30,000        $40,000        $50,000         $25,000

Number of employees.......                                      10                 30                 40                 20

Square feet........................        2,000                                   10,000          28,000          15,000

Direct labor hours..............                                                       5,000            6,000            2,000

Administrative services are allocated based on the number ofemployees; janitorial services are allocated based on squarefootage. Overhead rates for the three producing departments arebased on direct labor hours.

Required:

Determine the overhead application rates for the producingdepartments using each of the three allocation methods:

1.   Directallocation method for the support departments

2.   Stepallocation method for the supportdepartments      

3.       Reciprocal allocation method for the support departments

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