Villanueva Company has two producing and two service departments labeled P1, P2, S1 and S2, respectively. Direct costs for each department and the proportion of service costs used by the various departments are as follows: (P1, P300,000): (P2, P200,000); (S1, P100,000; S2- 25%, P1-50%, P2-25%); (S2. P40,000; S1-10%, P1-50%, P2- 40%). What is the total cost of P2 if the costs of service departments are allocated using the step method (start with S1)? * P262,222 P251,111 P253,889 O P253,334 P241,000
Villanueva Company has two producing and two service departments labeled P1, P2, S1 and S2, respectively. Direct costs for each department and the proportion of service costs used by the various departments are as follows: (P1, P300,000): (P2, P200,000); (S1, P100,000; S2- 25%, P1-50%, P2-25%); (S2. P40,000; S1-10%, P1-50%, P2- 40%). What is the total cost of P2 if the costs of service departments are allocated using the step method (start with S1)? * P262,222 P251,111 P253,889 O P253,334 P241,000
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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