Lempicke Corporation distributes its service department overhead costs to product departments. This information is for the month
Question:
Lempicke Corporation distributes its service department overhead costs to product departments. This information is for the month of June:
| Service departments | ||
| Maintenance | Utilities | |
| Overhead cost incurred | $60,000 | $16,000 |
| Service provided to departments | ||
| Maintenance | 0% | 10% |
| Utilities | 30% | 0% |
| Producing-A | 30% | 45% |
| Producing-B | 40% | 45% |
| 100% | 100% | |
Required
What is the amount of maintenance and utility department costs distributed to producing departments A and B for June using (1) the direct method, (2) the step method, and (3) the reciprocalmethod?
CorporationA Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Direct Method Maintenance Utilities ProducingA ProducingB Total DEPARTMENTAL ALLOCATION BASES Maintenance percent 000 3000 3000 4000 10000 Utilities p...View the full answer
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Related Book For 
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins
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