Refer to the data given in the preceding problem. When Jacksonville Instrument Company established its service departments, the following long-run needs were anticipated.

Required: 

Use the dual approach in conjunction with each of the following methods to allocate Jacksonville Instrument Company's service department costs: (1) direct method, and (2) step-down method.

Data From Preceding Problem:-

Jacksonville Instrument Company manufactures gauges for construction machinery. The company has two production departments: Machining and Finishing. There are three service departments: Human Resources (HR), Maintenance, and Design. The budgeted costs in Jacksonville Instrument Company's service departments during the year are as follows:

The usage of these service departments' output during the year just completed is as follows:

Transcribed Image Text:

Long-Run Service Needs (in hours of service) HR Provider of Service Maintenance User of Service HR.. Maintenance. Design. Design - 500 1,000 800 Machining.. 3,500 4,800 4,800 Finishing.. 5,000 2,400 1,200 Total....... 10,000 8,000 6,000