1) University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each.

The following data appear in the company records for the current period:

	Maintenance			Personnel			Printing			Developing
Machine-hours					1,000			1,000			3,000
Labor-hours		500						500			2,000
Department direct costs	$	5,000		$	12,000		$	15,000		$	10,000

Required:

Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.)

	Maintenance	Personnel	Printing	Developing
Service department costs
Maintenance allocation
Personnel allocation
Total costs allocated	$0	$0	$0	$0

2)

Caro Manufacturing has two production departments, Machining and Assembly, and two service departments, Maintenance and Cafeteria. Direct costs for each department and the proportion of service costs used by the various departments for the month of August follow:

				Proportion of Services Used by
Department	Direct Costs			Maintenance		Cafeteria		Machining		Assembly
Machining	$	99,000
Assembly		64,400
Maintenance		40,000				0.2		0.5		0.3
Cafeteria		32,000		0.8				0.1		0.1

Exercise 11-27 (Static) Cost Allocation: Direct Method (LO 11-2)

Required:

Compute the allocation of service department costs to producing departments using the direct method. (Do not round intermediate calculations.)

Total Costs

Machining-

Assembly-