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Arbon Company has three service departments and two operating departments. Selected data concerning the five departments are presented below: Service Departments Operating Departments Costs Equipment
Arbon Company has three service departments and two operating departments. Selected data concerning the five departments are presented below: Service Departments Operating Departments Costs Equipment Administrative Janitorial Maintenance $104,000 $67,800 $36,000 80 240 300 1,200 1,000 60 Number of employees Square metres of space occupied Machine-hours Prep $256,100 600 2,000 50,000 Finishing $ 498,600 300 7,000 75,000 Total $ 962,500 1,280 11,500 125,000 The company allocates service department costs by the step-down method in the following order: Administrative (number of employees), Janitorial (space occupied), and Equipment Maintenance (machine-hours). Required: Using the step-down method, allocate the service department costs to the operating departments. (Negative amounts should be indicated by a minus sign.) Service Departments Administrative Janitorial Maintenance paritariament Maintenance Operating Departments Prep Finishing on Total Departmental costs before allocations Allocations: Administrative Janitorial Maintenance Total costs after allocation 0 $ 0 $ 0 $ 0 $ 0
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