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Answered FF corp. has 2 service departments, admin and accounting, and 2 operating departments, eat and west. Admin costs are allocated based on employees.
Answered FF corp. has 2 service departments, admin and accounting, and 2 operating departments, eat and west. Admin costs are allocated based on employees. Accounting costs are allocated based on transactions. Admin Accounting East West (employees) (transactions) Direct costs 90,000 35,000 234,000 900,000 Employees 5 25 20 Transactions 40,000 15,000 45,000 What is the fully reciprocated cost of Admin using the reciprocal method? ect Answer 108,333 margin of error +/- 2 Make sure your equations for each target service department captures the direct cost of the target service department + the allocated cost from the other service department
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