Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations: Departmental costs before allocations Allocations: Service Departments Administration Janitorial $ 200,000 $ 70,000 330 1,200 Departmental costs before allocations Employee-hours Space occupied-square feet Required: Using the step-down method, allocate the costs of the service departments to the two operating departments. Allocate Administration first on the basis of employee-hours and then Janitorial on the basis of space occupied. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) Administration costs Janitorial costs Total costs after allocations Service Departments Administration Janitorial $ 200,000 $ Operating Departments Groceries Gifts $ 3,840,000 2,710 9,200 470 700 Operating Departments Groceries Gifts 70,000 $ 3,840,000 $ Total $ 340,000 160 800 340,000 $ 4,450,000
Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations: Departmental costs before allocations Allocations: Service Departments Administration Janitorial $ 200,000 $ 70,000 330 1,200 Departmental costs before allocations Employee-hours Space occupied-square feet Required: Using the step-down method, allocate the costs of the service departments to the two operating departments. Allocate Administration first on the basis of employee-hours and then Janitorial on the basis of space occupied. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) Administration costs Janitorial costs Total costs after allocations Service Departments Administration Janitorial $ 200,000 $ Operating Departments Groceries Gifts $ 3,840,000 2,710 9,200 470 700 Operating Departments Groceries Gifts 70,000 $ 3,840,000 $ Total $ 340,000 160 800 340,000 $ 4,450,000
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 30E: A company uses charging rates to allocate service department costs to the using departments. The...
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