QUESTION 7. The City of Harris has two departments—Parks and Recreation (P&R) an
ID: 2596108 • Letter: Q
Question
QUESTION 7.
The City of Harris has two departments—Parks and Recreation (P&R) and Facility Maintenance (FM)—
that provide services to its citizens. P&R offers many programs in art, culture and athlectics, while the FM department maintains all the streets, buildings, and other public facilities. Behind the scenes, Harris has two departments that support the activities of the P&R and FM departments. The Human Resources department processes payroll and oversees all hiring, development, and training. The General Administration department provides IT support, overall coordination, and managerial support.
The table below provides data regarding the costs traced to and consumption of services by various activity pools/departments.
HR
GA
P&R
FM
Traced costs
$100,000
$60,000
$360,000
$450,000
Service consumption pattern
HR
GA
P&R
FM
Services
provided by
HR
40%
30%
30%
GA
20%
60%
20%
7-4. Using the step-down method to allocate the costs of the two support departments to the line departments. Allocate GA first.
HR
GA
P&R
FM
Traced costs
$100,000
$60,000
$360,000
$450,000
Explanation / Answer
7-4. Using the step-down method to allocate the costs of the two support departments to the line departments. Allocate GA first.
HR GA P&R FM Traded cost 100000 60000 360000 450000 Allocation of GA first 12000 (60000) 36000 12000 Allocation of HR Cost (112000) 56000 56000 Total 452000 518000Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.