Question

Alfred, owner of Himinus−Tech Fiberglass​ Fabricators, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for​ analysis:

Budgeted manufacturing overhead costs​:
Plant Maintenance PM​ (Support Dept)	$320,000
Data Processing DP​ (Support Dept)	$55,000
Machining M​ (Operating Dept)	$215,000
Capping C​ (Operating Dept)	$110,000
Services furnished​:
By Plant Maintenance​ (budgeted laborminus−​hours):
to Data Processing	3,400
to Machining	5,800
to Capping	8,900
By Data Processing​ (budgeted computer​ time):
to Plant Maintenance	1,100
to Machining	3,550
to Capping	550

What is the complete reciprocated cost of the Plant Maintenance​ Department? (Do not round any intermediary​ calculations.)

The highlighted portion above is the question being asked. I have seen this similar problem asked before but the steps are unclear to me and I need a lot better guidance on this problem. Please help as much as possible and explain everything as simple and clear as possible. I am TERRIBLE with cost accounting. Please and thank you!

Answer 1

Data poocessing - $ 55,000 +(3400 / 18,100) plant motatanance plant me terance - $ 320,000+ (1,100)5,200) Data poocessing plant marntenance = $ 320,000 + (1100/5,200) x ($ 55800+(3400/19100) PM PM = $320,000+ 0.21xC $55,000 + (0-19) PM) PM - $ 320000 + 0.21C$55,000) + 0.2160.19) PM pm - $ 320,000+$11,550 + (0-0399) PM (1 - 0-0399) AM - $320000+ $11,550 0.9601 PM = $331,550 PM = $331,550 0.960) PM = $345,329