Betty DeRose, Inc. operates two production departments, molding andassembly, and two service departments, repair...

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Betty DeRose, Inc. operates two production departments, molding andassembly, and two service departments, repair and power. Servicedepartment costs are allocated to production departments using areciprocal two-stage allocation method. Repair department costs areallocated on the basis of repair hours and power department costsare allocated on the basis of kilowatt hours. In the second stage,departmental overhead rates for the two production departments arecalculated using direct labor hours as the activity for eachdepartment. Information for the four departments is given below:              Repair   Power   Molding   AssemblyDirectly trace overhead  $83,200  $160,000  $245,600  $320,000 Repair hours        60,000   8,000   10,000   22,000Kilowatt hours       160,000  600,000  180,000   60,000Direct labor hours      N/A    N/A   80,000   140,000The company is preparing to bid on a job, job #45, which requires 40direct labor hours in the molding department and 25 direct labor hoursin the assembly department. The direct material and direct labor costfor job #45 is expected to total $311.Calculate the total expected cost of job #45.

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Solution Service department cost Direct Cost Allocated Cost Repair Department Cost 83200 160000 16000018000060000 Power Cost 83200 040Power Cost Power Department Cost 160000 8000 80001000022000 Repair See Answer

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In: AccountingBetty DeRose, Inc. operates two production departments, molding andassembly, and two service departments, repair and...Betty DeRose, Inc. operates two production departments, molding andassembly, and two service departments, repair and power. Servicedepartment costs are allocated to production departments using areciprocal two-stage allocation method. Repair department costs areallocated on the basis of repair hours and power department costsare allocated on the basis of kilowatt hours. In the second stage,departmental overhead rates for the two production departments arecalculated using direct labor hours as the activity for eachdepartment. Information for the four departments is given below: Repair Power Molding AssemblyDirectly trace overhead $83,200 $160,000 $245,600 $320,000 Repair hours 60,000 8,000 10,000 22,000Kilowatt hours 160,000 600,000 180,000 60,000Direct labor hours N/A N/A 80,000 140,000The company is preparing to bid on a job, job #45, which requires 40direct labor hours in the molding department and 25 direct labor hoursin the assembly department. The direct material and direct labor costfor job #45 is expected to total $311.Calculate the total expected cost of job #45.