Answer:
Instructions are listed below.
Explanation:
Giving the following information:
Maintenance is the service department at CakeCo that incurred $12,000 of costs during the period. Overhead gets allocated based on floor space occupied by each of the operating departments.
<u>We don't have enough information to calculate the allocated overhead, but, I can leave the formulas and a small example to help with an answer</u>.
For example:
Total floor space= 10,000 square foot.
Baking department= 3,000 sq.
First, we need to calculate the estimated overhead rate:
To calculate the estimated manufacturing overhead rate we need to use the following formula:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= 12,000/10,000= $1.2 per square foot.
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 1.2*3,000= $3,600
