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Sequential allocation Carleton Company has two service departments and two production departments Information on annual manufacturing overhead costs and cost drivers follows

Sequential allocation Carleton Company has two service departments and two production departments. Information on annual manufacturing overhead costs and cost drivers follows:

 

SERVICE DEPARTMENTS

PRODUCTION DEPARTMENTS

ITEM

S1

S2

P1

P2

Overhead costs

$65,000

$55,000

$160,000

$240,000

Direct labor hours

2,000

1,500

2,000

3,000

Number of square feet

800

1,200

2,400

2,600

The company allocates service department costs using the sequential method. First, S1 costs are allocated on the basis of direct labor hours. Next, S2 costs are allocated on the basis of square footage. The square footage for S1 is assumed to be zero for this purpose. Determine the total overhead costs allocated to each of the two production departments.

Jul 01 2020 View more View Less

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