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Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $360,000 are allocated on the basis of budgeted warehouse – hours. Data Center Department costs of $180,000 are allocate based on the number of computer log – on hours. The costs of operating departments Music and Books are $135,000 and $162,000, respectively. Data on budgeted warehouse – hours and number of computer log - on hours are as follows: Support Departments Data Center Department Production Departments Warehouse Music Books Department $360,000 $135.000 Budgeted costs Budgeted warehouse- hours Number of computer hours $180.000 $162,000 NA 570 1,060 1,580 300 NA 830 1,100 Using the step – down method, what amount of Data Center Department cost will be allocated to the Warehouse Department if the service department with the highest percentage of interdepartmental support service is allocated first? (Round up) O A. $62,945 OB. $0 OC. $24,215 OD. $180.000

Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $360,000 are allocated on the basis of budgeted warehouse – hours. Data Center Department costs of $180,000 are allocate based on the number of computer log – on hours. The costs of operating departments Music and Books are $135,000 and $162,000, respectively. Data on budgeted warehouse – hours and number of computer log - on hours are as follows: Support Departments Data Center Department Production Departments Warehouse Music Books Department $360,000 $135.000 Budgeted costs Budgeted warehouse- hours Number of computer hours $180.000 $162,000 NA 570 1,060 1,580 300 NA 830 1,100 Using the step – down method, what amount of Data Center Department cost will be allocated to the Warehouse Department if the service department with the highest percentage of interdepartmental support service is allocated first? (Round up) O A. $62,945 OB. $0 OC. $24,215 OD. $180.000

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 28E: Minor Co. has a job order cost system and applies overhead based on departmental rates. Service...
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Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $360,000 are allocated on the basis of budgeted warehouse - hours. Data Center Department costs of S180,000 are allocated based on the number of computer log - on hours. The costs of operating departments Music and Books are $135,000 and S162,000, respectively. Data on budgeted warehouse - hours and number f computer log - on hours are as follows: Support Departments Warehouse Department Production Departments Data Center Department Music Books Budgeted costs Budgeted warehouse - hours Number of computer hours $360,000 $180.000 $135,000 $162.000 NA 570 1,060 1,580 300 NA 830 1,100 Using the step - down method, what amount of Data Center Department cost will be allocated to the Warehouse Department if the service department with the highest percentage of interdepartmental support service is allocated first? (Round up) O A. $62,945 O B. $0 OC. $24,215 O D. $180,000
Transcribed Image Text:Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $360,000 are allocated on the basis of budgeted warehouse - hours. Data Center Department costs of S180,000 are allocated based on the number of computer log - on hours. The costs of operating departments Music and Books are $135,000 and S162,000, respectively. Data on budgeted warehouse - hours and number f computer log - on hours are as follows: Support Departments Warehouse Department Production Departments Data Center Department Music Books Budgeted costs Budgeted warehouse - hours Number of computer hours $360,000 $180.000 $135,000 $162.000 NA 570 1,060 1,580 300 NA 830 1,100 Using the step - down method, what amount of Data Center Department cost will be allocated to the Warehouse Department if the service department with the highest percentage of interdepartmental support service is allocated first? (Round up) O A. $62,945 O B. $0 OC. $24,215 O D. $180,000
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