Refer to Exercise 8.24. Assume instead that Cedar Hill Manufacturing uses the step down method and allocates administration costs first followed by custodial services costs.

Exercise 8.24

REQUIRED
A. Using the step-down method (round to 2 decimals):
1. Allocate the administration costs to the production departments.
2. Allocate the custodial services costs to the production departments.
B. Calculate the total costs (direct plus allocated) for each production department.
C. Calculate a cost per unit produced for cutting and assembly.

Transcribed Image Text:

Production Departments Administration Custodial Services Cutting Assembly 100,000 $345,000 $731,000 0000 50,000 0,000 0,000 90,000 Direct costs Labour hours Space occupied (m2) # units produced $160,000 12,000 5,000 10,000 5,000 50,000