25.

Pederson Company has two service departments (Cafeteria and Human Resources) and two production departments (Machining and Assembly). The number of employees in each department follows.

Cafeteria	30
Human Resources	70
Machining	300
Assembly	500

Pederson uses the direct method of cost allocation and allocates cost on the basis of employees. If Human Resources cost amounts to $1,800,000, how much of the department's cost would be allocated to Machining? (Do not round your intermediate calculations.)

Multiple Choice

$360,000.

$675,000.

$600,000.

$1,080,000.

None of these.

26.

Pederson Company has two service departments (Cafeteria and Human Resources) and two production departments (Machining and Assembly). The number of employees in each department follows.

Cafeteria	30
Human Resources	70
Machining	300
Assembly	500

Pederson uses the direct method of cost allocation and allocates cost on the basis of employees. If Human Resources cost amounts to $1,800,000, how much of the department's cost would be allocated to Assembly? (Do not round your intermediate calculations.)

Multiple Choice

$600,000.

$675,000.

$1,125,000.

$1,080,000.

None of these.