2. 1000 ponds value 1 departments (Printing and Developing) Management has decid

Question

2. 1000 ponds value 1 departments (Printing and Developing) Management has decided to allocate maintenance costs on the basis of machine -hou employees in each. Printers has two service departments (Maintenance and Personnel) and two operating in each department and personnel costs on the basis of labor-hours worked by the The following data appear in the company records for the current period 1,800 650 5,400 2,600 1,800 Machine-hours Labor-hours Department direct costs 650 34,000$56,000 $65,000 $ 50,000 Required: Allocate the service department costs using the step method, starting with the Maintenance intermediate calculations.) PrintingDeveloping Service department costs Personnel Total costs allocated ReterencesBook& Resources Exercise Difficulty: 2 Medium Le 341

Explanation / Answer

Allocation cost under step method :

Maintenance Personnel Printing Developing Departmental cost 34000 56000 65000 50000 Maintenance -34000 6800 6800 20400 Personnel -62800 12560 50240 Total cost allocated     -     - 84360 120640

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