Alvis Company has two service departments and two producing departments. Information for each department follows:...
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Accounting
Alvis Company has two service departments and two producing departments. Information for each department follows: Service Departments Producing Departments 2 $77,000 $62,000 1,000 Budgeted overhead Machine hours Direct labor hours Square feet occupied $250,000 8,800 17,000 3,500 $320,000 11,200 22,000 9,000 1,900 1,400 850 500 A's costs are allocated based on square feet occupied and B's costs are allocated based on machine hours. Predetermined overhead rates for the producing departments are based on direct labor hours. Allocate the service department costs using the step method, starting with Department A. Calculate the predetermined overhead rates for the producing departments. Predetermined overhead rate for Producing Dept. 1 - $ Predetermined overhead rate for Producing Dept. 2
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