Can you show the work for Problem #2 to get the correct answer? ACG 311, Spring

Question

Can you show the work for Problem #2 to get the correct answer?

ACG 311, Spring 2018. Some practice problems for Exam 2 From Chapter 7 The next two questions are based on the following: Oaks Company has two support departments, Maintenance Department (MD) and Personnel Department (PD), and two producing departments, Pl and P2. The Maintenance Department costs of S30,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $4,500 are allocated on the basis of number of employees. The direct costs of Departments Pl and P2 are $9,000 and S15,000, respectively Data on standard service hours and number of employees are as follows: Standard service hours used 100 50 300 150 Number of emplovees Direct labor hours 10 20 90 90 50 50 250 250 1. Using the direct method, what is the cost of the Maintenance Department allocated to Department P1? (Ans: $20,000) 2. Using the sequential method, if the support department with the highest percentage of interdepartmental service is allocated first, what is the cost of the support departments allocated to Department PI? (Ans: $21,750)

Explanation / Answer

Maintenance Personnel p1 p2 Costs 30000 4500 9000 15000 cost allocated -30000 3000 18000 9000 0 7500 3750 3750 21750 12750 300/500*30000 = 18000 90/180*4500+3000 =3750

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