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Aiman Bakery produces and sells a variety of cakes around Selangor. The bakery has two operating departments Mixing and Packaging - and two support departments
Aiman Bakery produces and sells a variety of cakes around Selangor. The bakery has two operating departments Mixing and Packaging - and two support departments - Machine Maintenance and Human Resources. Jati Wood Company uses machine-hours to allocate Machine Maintenance costs and number of employees to allocate Human Resources costs. The following data relate to the 2018 record:
Required:
a. Allocate the two support departments cost to the two operating departments using the following methods:
i. Direct method (10 marks)
ii. Step-down method with the sequence of allocation based on the highest-percentage support concept.(11 marks)
b. Distinguish among the three methods of allocating the costs of support departments to operating departments. (3 marks)
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